You had it right the second time. He's a huge Paris Hilton fan, so he's partially adopted her name and make his stage personality out of it.
I feel a little bad for Perez because he went to school to do fine arts, and he got a couple of bit parts, but a career never came out of it. He had some freelance writing, and then moved into blogging because, I guess, he didn't have to adhere to the constraints of his employers. I would also imagine he was the type to always get picked on even from the get-go, so I think part of what fuels his bitchiness and outlandish attitude is that that is the only way he can recover that self-esteem he lost a long time ago. Rather than offer constructive opinions or think about the big picture, it's much easier and less brain-intensive to talk a bunch of shit about people and hide beyond a keyboard. As someone else said earlier, karma's a bitch.
I think it's kind of sad that he holds himself up as some kind of gay activist, but that he believes the only way gay people will get anything in this country is to remain visible. I applaud people who have the courage to come out, but Perez is incredibly short-sighted to think that dragging celebrities out of the closet will somehow help his cause. Really? Because that might just fuck up someone's paycheck, and I know he'll catch way worse than a punch if he continues to do that.
It would be rewarding for fellow celebrities, gay and straight, to stand up against Perez's antics. He called a singer and fellow entertainer a faggot just so he could hurt his feelings. You don't like the dude's music? Fine; don't listen. But if you're trying to call people names, prepare to get stomped a little. I know that if he did that in the hood messing around the wrong one, he'd have to pick up some teeth!