Yeah, I did something like this recently, but this is how I did it:
$showNum = 10;
$startNum = 0;
if($paged > 0){
$pageNum = $paged - 1;
$startNum = $pageNum * $showNum;
} elseif($paged == 0){
$paged = 1;
}
Then I went ahead and used the modified $paged value to request entries within the range of the requested page.
In the code sample you provided, you are defining $paged on line two. If this is a template file, then the $paged variable should already be defined by the time it gets to this page.
If I’m understanding it right, the $paged variable is used for determining what page of the set you are on. Do a var_dump($wp_query); to figure out what the current value of $paged is on your system.
Maybe this will help.