I've spent Christmas in Paris twice, and in Arles once. What you should know is that many (most) restaurants in Paris are closed or booked on Christmas, so if you've got your heart set on a particular venue or restaurant, and you decide Paris is it, you might want to make those reservations IN ADVANCE because there will be no getting them on Christmas (if you arrive in Paris on the 25th).

Christmas in Paris is beautiful. The métro runs fine, you have the beauty of the city essentially without cars! (at least until about 4pm). All the commercial stuff is closed, but hey, go see Sacre Coeur, Notre Dame (they're open, natch), and walk, walk, walk! It's magical.

Arles was essentially CLOSED for the day. I assume Avignon is like this, too. We enjoyed wandering around the town, but it was essentially a quiet day to ourselves, with lunch at our hotel and then a mad scramble from place-to-place looking for some dinner. (We did fine, in the end, and had a superb meal at a Spanish place).

So my vote would be for Paris, but you want to arrive up there early, not when all the Parisians are returning to town. The TGV from Avignon is about 3 hours, so book a morning one, pick First Class and eat a meal on the train.

Have a great time!