If what you're looking for is a balanced PvP, probably the retail server wins. However, Ragnarok is highly dependant on gear, cards etc, so basically the older the player is on the server, the better he is on PvP, considering equal skill. On retail, that difference can be huge (like a royal guard with Tao Gunka card); on private servers maybe that don't matter so much, because getting gear/cards is easier (again, depends on rates).
Usually, private servers have smaller communities, and the PvP is more personal, with friends, allies, vendettas etc. In retail, with more people, there's more battlegrounds, it's less to-the-heart PvP.