Of course they can check at the point of sale, but times where paper money is most useful and times where you have immediate access to the blockchain do not exactly overlap. If they can check right then and there, might as well just do it electronically and skip the paper.

My point is basically that paper money is a store of value while these "paper bitcoins" are a proxy for a store of value, which introduces problems. It's almost like a fiat currency backed by bitcoin, except it has none of the governmental power used to make fiat currencies work.