Depends on the game, how often to swap discs (very linear game?), the amount of available harddrive space, etc.
Personally in general I prefer the Uncharted: Drake's Fortune approach, Blu-Ray / harddisk streaming optimization resulting in no-ingame loading times without the need for installs. I prefer having no disc swaps and not too much data needed to be installed.
Overall the PS3's Blu-Ray drive loads data faster than the 360's DVD drive can read dual layer discs. But DVD file structure optimization (outer tracks providing data much faster than the inner tracks) needs to be reworked and optimised for the Blu-Ray format (constant speed).
I don't have a problem with minimal harddrive installs for the most loading speed critical data or for more user comfort (getting the game up and running as fast as possible) such as in Ratchet & Clank: Tools of Destruction.