What is significant about the fact that Pip calls Magwitch "Estella's Father"?

Magwitch was the husband of Jaggers' servant woman, the Tigress. The woman had come to Magwitch on the day she murdered the other woman and told him she was going to kill their child and that Magwitch would never see the baby again. And Magwitch never did. Pip puts it all together and tells Herbert that Magwitch is Estella's father.

Estella is the daughter of a convict and a murderous tigress! Pip's idea of all that is desirable in this life -- Estella, wealthy, beautiful, uncommon Estella -- is more closely related to the world of criminals and convicts than even he. Pip has been blindly headed towards what he thought he was running away from in the first place.

Of course, he does not feel any less respect or love for Estella. He cannot, because he knows her to be a lady. And so he must start to reevaluate how he judges people. He has judged himself harshly, at times, because he feels he has always been surrounded by criminals and violence and this is a reflection of his value as a person. But he can no longer do that, now that he sees that his benefactor is the father of the woman he loves.

Strangely, Pip feels he has not become what Magwitch had hoped for: a gentlemanly son. Unconsciously, however, Magwitch has given the world a ladylike daughter, in all ways very upper-class and uncommon.