With webservices you can dynamically query and therefore implement true paging.
Without webservices, InfoPath dataconnections load all of the data from a data source, so from a performance standpoint you can not gain anything.
From the user perspective, you can either put a repeating table in a scrolling section and allow the user to scroll the records without scrolling the form.
Or use multiple repeating table controls bound to the same data and conditional formatting to only show a subset of the record set.
Then in the next repeating table control, show the next group of records and so on.