(1) Now or later?
Are you upgrading at launch, or sometime after? With installs/download up to 50GB or so per game, re-installing later after an internal hard drive upgrade could be a massive PITA. On the other hand, upgrading right away might be a mistake (see next question).
Me: I think I'm going to take a chance and upgrade for launch. My ISP has a bandwidth cap monthly and I'm going 100% digital download this gen. So I don't want to have to re-download several hundred GB of data in a few months if I upgrade the HDD later.
(2) Storage or performance?
In the sub 12mm 2.5in form factor, the best options I can find are either a 1.5TB standard hard drive, or a 1TB hybrid (w/8GB of NAND flash).
Me: Originally I was going to go with space (again, so I would only have to upgrade the drive at launch but then hopefully not ever again until PS5), but after more thought I think 1TB is enough for about 20 games or so and that seems adequate to me coupled with a potential performance boost. So, I think I'll be going with the hybrid. Of course there's a pretty big question mark about if the hybrids will perform as well in a PS4 as they do on say a Windows PC.
Before I pull the trigger I wouldn't mind hearing what other people are thinking of doing. I thought this could be a thread, but if people disagree then mods please merge it into the main PS4 thread I guess.