Pasting directly will create an Image element that points to the PastedVector.svg file, and be treated like any other image format.
Creating an HTML Widget and pasting the SVG contents produces an iframe (a HTML page that has its own URL, so this is very heavyweight), and then you are placing SVG data onto that. From a resizability perspective, there's usually nothing that ties the size of the iframe to the size of the SVG data - you would typically need to add width/height 100% styling to the code. But you can direct edit the code this way.
The other option is to create a Rectangle element, and then paste the SVG code like the HTML Widget. The Rectangle is just a
<div> on the page, so it does not require making a file and then making a network request to that file to fill an iframe. Beyond this, it has the same limitations and advantages as the HTML Widget method.
I have a recollection that if the SVG has embedded SMIL animations, some browsers won't render them when treated as an image element. Pasting the code direct is a solution for this edge case.