CSS is CSS. You'd don't choose one over the other. CSS3 is just more CSS. The reason they named it CSS3 is because there was enough new stuff coming out that it deserved to have it's own version.
Like, felgall said you have to watch out for which browsers support which CSS features. Some browsers "Cough, Cough Internet Explorer", don't have very good support for the features in CSS3. Some browsers "Cough, Cough Internet Explorer" don't even support some features in CSS2.