Yup Paws was the place in the Ultima games, New Paws is it's reincarnation on Europa. The original Paws also featured the famous Cat's Lair tavern which was run by Dr. Cat. The tavern was also full with cats.
Paws used to be a small farming community in the Ultima games, next to the Fens of the Dead swamp. In later games it became an exile for beggars and poor people (U7 and on).
I think Paws just didn't make it into
UO because in that area of the map there's already quite a few towns in close proximity - Trinsic, Britain, Skara.