ETA: Well, as usual, I'm not nearly quick enough 
but I'll leave my post here anyway.
Kepub vs. epub is entirely personal preference.
I think the pop-up footnotes in kepub are very popular. Also the double-tap on image to zoom may be useful. Also kepubs have the page number within chapter option where 1 screen = 1 page. Whereas, in standard epubs, page number is always page within entire book and is the Adobe calculation of page number.
Having said that, my personal preference is still standard epub, mainly because I know exactly what I'm going to see. You can't (currently) open a calibre kepub in the calibre Editor from within calibre.
There seems to be a lot of confused and confusing advice offered regarding kepub conversions. This is my take on it (which may be yet another confused and confusing opinion
)
If you decide kepub is best I wouldn't advise doing a mass calibre conversion to kepub. Leave epub as your 'master' format and use the calibre
Kobo Touch Extended Driver plugin to replace the standard KOBOTOUCH driver. If you select a standard epub in calibre and send-to-device, on-the-fly it can auto-convert to kepub and send the kepub to the device. Calibre will still only have the epub and the Kobo device will have a kepub.
If you think kepub is only best for certain books (like me) then the
KePub Output Plugin is a better option. With this installed you can do a calibre any-format-->kepub conversion and the kepub format will reside in calibre alongside all other formats for that book. Then when you USB-connect the Kobo to calibre you would choose the kepub format when you send-to-device. In which case you would probably stick with the standard KOBOTOUCH driver.
Best advice is to try a couple of each before making your mind up.
@Josie,
You don't need to choose kepub to get a little space between top of screen and first line of text. There are other options. The Kobo Patcher is one but if you're not comfortable with that the 'Modify CSS' option of the KOBOTOUCH driver is very simple to install.