It all depends on how strict you want to be. Yes, grass fed beef is better than grain fed but lean protein is way better than vienna sausages. People get all bent out of shape over it and I think that really gets in the way of the basic idea. If you think of eating paleo as a quality of food concept (i.e., eat whole, unprocessed foods as much as possible) you'll do pretty well. The rest is really in the margins. Many people add dairy back into their diets after getting their insulin levels rebalanced; however, olive oil is still a better source of fat for cooking. Will the diary "void" paleo? No, you're just eating less paleo than you could but you're still eating 10,000x better than the average American who pounds Big Macs. Can you get really strict and say Wolverine's sesame oil, soy sauce and rice wine vinegar are out? Sure, they're not paleo but in small amounts the effect is really minimal so if it makes a big difference in you enjoying your food, it's not a huge deal.
At the end of the day, it seems that people who choose to eat as strict a paleo diet as they can are healthier, leaner, more energetic and fitter than those who choose to eat grains, glutin, added sugars, dairy and alcohol.