Self-hosted. The only reason I would ever recommend WordPress.com or Blogger is if someone needs anonymity for some reason or simply doesn't have time or know-how to install their own software.
I went from using self hosted wordpress to using wordpress.com
I didn't like having to always worry if my VPS was up, remembering to always upgrade to the latest version, etc. Using a hosted solution means giving up some control but for now it has worked out just fine.
