Nikki was in the compound with Ian and the followers including Paul. They could have been brainwashed, drugged, or many other things, to possibly make Paul the Dad. If Nikki thinks Ian could be the father then so could Paul. Doesn't matter that she was married to anyone, she was in Ian's lair when Dylan was conceived. Don't understand why they just don't take a paternity test on Ian.
We are talking about a soap here where they could pretty much do anything they want with the story line whether it makes sense or not. With how these writer's have written, pretty much everything goes, like it or not.