In a nutshell:
I suspect every other Republican would launch a war against Iran. Paul wouldn't. That alone makes a vote for him worthwhile.
Sullivan's overall argument is of course, far more nuanced, and it's difficult to disagree with him on many points - particularly the one regarding the honesty of debate we would see between Obama and Paul:
I believe an Obama-Paul campaign would do us all a service. We would have a principled advocate for a radically reduced role for government, and a principled advocate for a more activist role. If Republicans want a real debate about government and its role, they have no better spokesman. He is the intellectual of the field, not Gingrich.
Sullivan is not endorsing Paul for President, just as the GOP nominee. I'm sure he'll stick with Obama as he regards him as fellow conservative (in the British mold, not the American), but his call to elevate Paul to mainstream status is an interesting one.
Sullivan, like most sane observers, is so exasperated by the current crop of Republican candidates that he is willing to endorse a slightly loopy, unelectable but un-corrupt 76 year old. Sadly, his argument makes a lot of sense, a testament to just how dire Right wing politics in America has become.