Ok update:
As far as I can see, this isn't just a problem with Title/Content Search, it's with any querying and ajax pagination:
As a followup I tested this on a vanilla discover-wp install, and unless I'm really getting something wrong in the setup, it doesn't work. I did a very basic markup for testing purposes, it just lists out each post title returned with a red box, 4 per page:
NO AJAX:
http://evantest4.discover-wp.com/testquerypagination-noajax
WITH AJAX:
http://evantest4.discover-wp.com/testquerypagination-ajax/
Try the above using the word "with" will return enough results to test. As you'll see, the searching word "sticks" with no ajax but disappears with ajax.
SIMILARLY:
I tried searching only for categories. Which also doesn't work with ajax pagination UNLESS you also checkmark "Update the View results every time an input changes" — but this doesn't help the title/content searching above:
Try this. The category "markup" will return enough results to test with:
http://evantest4.discover-wp.com/testquerypagination-cats/
I can get you password info so you can play with what I did if you need to.