>>Which do you find more readable and why?
>
>I prefer some use of tabs, but trying to get everything line up neatly is futile. Your example works only if tab width is set to 8 and font is set to monospaced. It actually looked quite jagged in most of my setups (usually Tahoma, Verdana or Trebuchet, 10, sometimes 9, sometimes bold). And my tabs are usually set to 3 spaces, unless I forget and leave them at 4.

After the first visible character on a line, tabs shouldn't be used. That solves the problem you mention and lets people change tab widths and it will only change the initial indention.