@Brian -- I started putting this in a comment following your comment to Norman Gray's response, but the code sample made it too large. \paragraph{} doesn't change the typesetting of regular paragraphs. It's just that, counter-intuitively, the paragraph begun by the \paragraph{} command is not a regular paragraph; it's a section element in the document. Play with the code below to see how the \parskip and \parindent affects the regular paragraphs but not the "\paragraph" section element. (Actually, \parskip affects even the \paragraph{} items but the spacing before a \paragraph{} item is calculated to always be slightly more than \parskip, which is why there's always a space between \paragraph{} elements even if \parskip is 0.)
I think 99% of LaTeX docs probably never use the \paragraph{} section command. Regular paragraphs in LaTeX are separated by (1) a blank line ("regular paragraphs" 1 and 2 below) or (2) by the \par command ("regular paragraphs" 3 and 4 below).
\documentclass[oneside,11pt]{memoir}
\usepackage{fontspec}% font selecting commands
%\usepackage{xunicode}% unicode character macros
%\usepackage{xltxtra} % some fixes/extras
\begin{document}
\setlength{\parskip}{0pt} % 1ex plus 0.5ex minus 0.2ex}
\setlength{\parindent}{0pt}
\pagestyle{plain}
\paragraph{paragraph section 2}adorem ipsum dolor sit amet, consectetur adipiscing elit. Aliquam enim
urna, mattis eu aliquet eget, condimentum id nibh. In hac habitasse platea
dictumst.
regular paragraph 1 -- orem ipsum dolor sit amet, consectetur adipiscing elit. Aliquam enim
urna, mattis eu aliquet eget, condimentum id nibh. In hac habitasse platea
dictumst.
regular paragraph 2 -- orem ipsum dolor sit amet, consectetur adipiscing elit. Aliquam enim
urna, mattis eu aliquet eget, condimentum id nibh. In hac habitasse platea
dictumst.
\paragraph{paragraph section 2}ipsum dolor sit amet, consectetur adipiscing elit. Aliquam enim urna,
mattis eu aliquet eget, condimentum id nibh. In hac habitasse platea dictumst.
\par regular paragraph 3 -- orem ipsum dolor sit amet, consectetur adipiscing elit. Aliquam enim urna, mattis eu aliquet eget, condimentum id nibh. In hac habitasse platea
dictumst.
\par regular paragraph 4 -- orem ipsum dolor sit amet, consectetur adipiscing elit. Aliquam enim urna, mattis eu aliquet eget, condimentum id nibh. In hac habitasse platea
dictumst.
\end{document}