It's very hard to compare the two players. They played in different eras. Very tough call either way.
Its a very easy call.
One is a Legend of the Game and considered to be one of the Top 20 Players of ALL TIME.
The other was one of the best players of the 90's and one of the Swans greatest 5 players (He was named the TOTC Vice Captain, but I think the like's of Nash, Pratt and Goodes muddle the Top 2-5 placings debate). Era's they played in don't come into it.
Yes Paul Kelly was a great player, but his deeds on the football field don't come close to matching those of Skilton and it doesn't even matter which State of Australia either of them was from.
We are just damn lucky to have two very good players to have worn the 14 jumper with pride and are able to have this kind of discussion.
As for the debate over retiring jumpers. I think you should only do it for numbers of "special meaning" and 14 clearly has because of Skilton and Kelly earnt that right. But for most other number such as 1, 11, 31 and most likely 37 I say rest them for a season upon retirement of a club great such as a Maxfield, Hall, Kirk etc and give them to a draftee at random the next season they are available.
As for 14, I'm all for retiring it for good. But if it is ever returned to "service" don't "hand it down" upon a player, because they will then be expected to live up to the jumper. Just pick a new draftee at random (regardless of where they are from) and give them the number and let them grow into the number without expectation.