Domestic travel - usually economy or E+, unless coast to coast, in which case I might go Business or First if the upgrade price is low or I have a lot of miles I'm not saving for something else.

International - I work hard to get an upgrade with miles, and will sometimes pay for it if I have to. A bad overnight flight ruins the vacation or business trip for me (and I've had my share of bad experiences in coach, but none in business), while the difference between staying in a good hotel and a fancy hotel does not matter as much to me. (Location of hotel is the most important thing to me.)

That's just me. For other posters, it is the opposite, and I think we all value different things.