It's still in beta. A student account is just a sub-account on a regular Business or Premier account. It lets parents set up sub-accounts so they can monitor their kid's activities. I don't see any benefit in getting one. http://technobabble.typepad.com/my_weblog/2008/12/paypal-student.html
Unless you have kids and want to monitor their spending habits, but yes it is better to set them up a bank account and monitor that instead.