I can give my opinion about these two different questions.
1) Personally, I don't think that current Kenyan runners are better than runners of 20 years ago. The talent of Kip Keino, Ben Jipcho, Mike Boit, Henry Rono, John Ngugi was probably bigger than the talent of today's runners. What is different is their professionalism. Now the best runners train twice per day, and rest short time every year. Among young people, also the type of life is changing. Now a good percentage of top kenyan runners are able to use the money that they earn not only building houses or buying cows, but in more modern way. Under this point of view, the best runners of young generation are approaching to a western mentality. In many cases, best runners have european coaches, and the best managers, on the contrary of what many can think, can help them in lasting and living with more professionalism their athletic life.
At the time of Keino (40-30 years ago), top Kenyan runners trained only 2-3 times per week, and only on track. Their base was very high, but directly depending on their normal daily activity : running for going to school, working in the country, using their body for every natural kind of problem. They were natural talents, able to stay on the top only with little training, already having a very important base due to their life.
Currently, Kenyan life is no more so important for building a base. In Nairobi nobody runs, like in all the big cities in the world. In Rift Valley, there are already a lot of cars, and children don't need to go to school running for many km, as the number of schools increased, and schools are not far from villages and small towns.
But, at difference of 20 years ago, now there is a more organized activity, with many competitions, more meetings and more opportunities. A big number of Kenyans (young but also over 30 years of age) try to run for having the opportunity to compete in Europe or US, for earning money (in the past this was not possible), so the selection is bigger than years ago. With a lot of managers interested in Kenyan runners (someone very good, others not well involved in World Athletics, so not able to develop athletes in a correct way), about 1200 runners can go around the world for competing : many of them are very poor runners (worse than europeans or americans), someone instead has good talent and good training.
So, the reason of their supremacy is not altitude or something genetic, but expecially their type of life, combined with a free mentality and a good training.
But, first reason, is the worsening of western runners. Our Society is no more able to produce young guys naturally prepared with a good aerobic base, having the possibility of improving to top level, using specific training SUPPORTED BY A HIGH AEROBIC BASIC LEVEL.
See what happened in 10000m in European Ch. '78 (Prague) :
7 athletes under 27'38", when now only 4 are able to run so fast in the full season. And also about steeple, in OG '76 3 Europeans were in the medals : 8:08 Garderud, 8:09 Malinowski and 8:10 Baumgartl (27 years ago !).
In Italy we had Fava, Ortis, Cova, Panetta, Antibo, Lambruschini : everyone won some medal. Now, the best Italian runner is 1 min slower in 10000m, and 25.0 slower in steeple.
So, we must not look at African runners for learning something, but at our society for changing our mentality recovering old motivations, if we want to have good runners. In other case, simply, running at top level is no more an activity today appreciated by our people.
2) Paula is a very great runner, having big talent from her beginning. I remember that the first time I saw her, was during WCCCh in Boston '92, when she won running on the snow, beating kenyans and other best Europeans.
She never had serious injuries, and always had continuity in her training. Under this point of view, she was very different from Kenyan runners. See, for example, Lydia Cheromei, one of the most talented runners all-time : able running in 33:20 in altitude only 13 years old, never had two following seasons of training.
So, Paula was able to develop her talent, enhancing long distances to a level previously incredible. But, if we look at Paula not as woman, but as athlete, her results are really normal. Personally, I have an athlete (35 years old) with personal bests like Paula (14:28 and 30:02), able running full marathon in 2:11:23. So, I think that, in her top shape, Paula can run 2:13, and for me is not surprising. What could do Tegla Loroupe with a technical activity, not only due to talent, but also to technical choices ? If you think that, when she improved the World Record in Marathon in Berlin, she competed during all summer in Golden League running short distances (and of course never ran long run), then (only 10 days after the GP Final) ran a HM in 1:09, then one week later improved the WR in Marathon, then the next week won World HM Ch., and next week again ran another HM in about 1:09, you can understand that already Loroupe had the possibility running in 2:16 with more precise choices (also in training).
So, for me performances of Paula are not amazing, but normal. The fact is that today is possible to reach the top, for a woman, having a medium talent, but with a very good training (like men), or having a big talent, also without a very good training. If we can find some athlete able to combine big talent and good training, final result is what Paula is able to do. And remember that, for Paula, now is difficult to win some race in 5000/10000. In Paris, also the best Paula probably could not win 10000, as Berhane Adere gave the impression to have the possibility of running about 29:45 without many problems. So, the big surprise is only in the Marathon, but this is because normally athletes of top talent are not approaching Marathon with a correct methodology.