So that will probably work fine. Though I'd make it a pre-solve callback (in case something weird happens that causes it to be in contact for multiple frames), and also return false from the callback so the regular physics doesn't apply. Also, it's safe to assume that you will only ever have a single contact point if one of the shapes is a circle and you can get rid of the for-loop.
Alternatively, what I've done in the past was to change the collision information itself. Basically, I made the paddle act as though it had some circular curvature to it even though it's surface was flat. I did that by changing the contact normal and point based on the position of the ball relative to the paddle. http://chipmunk-physics.net/release/Chi ... rFunctions
It ended up with a very nice, physical feel to it and allowed you to really slam the ball with the paddle if you wanted to.
Unfortunately I can't share the original code since it was for a contract project, but I could rewrite it maybe.