Some people swear by paper-in-oil (PIO) capacitors for electric guitar tone circuits. They say all else being equal (same capacitance, similar tolerance — voltage is not relevant in guitar circuits), a PIO capacitor will sound different, meaning better. Words like “warmer”, “mellower”, “livelier” are being employed to describe the difference. The theoretical basis for this would be the dissipation factor, which obviously varies with capacitor “architecture”.
Warning: The following is not a thorough test, nor a fair comparison. The setup I used is not appropriate for any scientific conclusions. In fact, this “versus” is simply my own subjective experiment with these two awesome pickups by Seymour Duncan: the JB SH-4 and the Custom SH-5. But then again, in the world of guitar and tone, as much as we may strive for scientific accuracy, in the end it all comes down to player (and listener) preference. I don’t intend to praise either of the pickups, I’m not trying to get anyone to buy the one or the other, and most importantly, I’m not trying to change anyone’s mind, so please don’t come at me for merely expressing subjective opinion, labeled as such. Remember that your guitar and rig may sound completely different than mine, with these same pickups – this is part of the disclaimer Seymour Duncan themselves have for the tone samples they offer over at their website.