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I think azw3 gives you more features and most people in here recommend it. Personally I convert to mobi, not for any real reason but out of habit. I started using it before azw3 existed and I've never had any reason to change it so far. It works fine for me.
I think if I was starting over I might start using azw3 because people here usually recommend it.
Mobi does have one small advantage, actually. I like to use Moon+ reader on my phone and it can handle mobi files but not azw3 files. That's a fairly trivial advantage since I usually convert to epub for Moon+ anyway but now and then I just want to take a look at something and it's not worth the trouble to convert to epub and with mobi I can do that.
Barry
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