Personally, I think the way to go is to pick a batsman who is good in the field. For Australia, someone like Mike Hussey or Brad Hodge. For England, Vikram Solanki or maybe Paul Collingwood.
If you bowl first, obviously you sub out a bowler who has completed his 10, and get an excellent fielder, maybe someone who can send down a few part-time overs if needed, and an 8th batsman when you bat. Obviously, you pick five bowling options in the original team. If you bat, you use the sub if you get into trouble, otherwise you don't and you keep your five bowling options for when you bowl. Either way it's an advantage in flexibility. Say Australia pick five bowlers, or four bowlers and a full-time all-rounder, if they get in trouble they bring in Hodge and look to Symonds and Clarke to bowl 10. If they don't, they keep five bowling options.
Picking an all-rounder is perhaps slightly safer, but there's not as much to be gained from it. If Australia picked someone like James Hopes they could sub out a completed bowler and get a few overs and a decent bat, but again if you bat first it's not such a big advantage, since you'd be losing a better batsman or a better bowler by making the sub in the first innings. It's better to go for a specialist who is good in the field, rather than a bits-and-pieces player who's not going to add a heap to your side anyway.