For apps that do not use the Amiga's custom chips, ie Workbench friendly, emulation may be better because it can take advantage of the latest hardware, ie newer Video Modes via Picasso96 and newer Sound Cards via AHI. Also, it is cheaper and easier to set up more modern things like Ethernet, Internet, CD-Burners, USB devices, etc...
However, apps that depend on Amiga's custom chips, especially Sound apps that need Paula, the real thing cannot be duplicated exactly. So sounds/music can sound different in emulation.
I use WinUAE for emulation on my WinXP machine and it's quite amazing. I also have Amithlon on a PIII-1000 machine which is really amazing. But I still keep my classics (see my sig) and use them once in a while.
