I sell on both etsy and ebay (and on my own website) and have found that it depends on what you're selling. You have to figure out the market, I guess.
For example, my grudge journals have done very well on etsy (and I appreciate the low fees, the automatic storefront and the overall indie/crafty nature of the site) however, if you have a specific item that you can target on ebay you'll do quite well based on the traffic they get.
This time of year is an excellent time to move some merchandise on ebay. I've done pretty okay. That said, fees are high (especially when coupled with paypal fees!) so you have to price your work accordingly. I do very well with wedding items on ebay and I do well with items that have some sort of fan base/crossover appeal (for example, it's much easier to sell a "Hawaiiana" or "Cyndi Lauper" journal than a "handmade" one. At least that's what I've experienced. I will continue to sell on both, hopefully learning as I go. I also use ebay to drive traffic to my site by pointing out that I sell handmade items on my own website and to check my About Me page for a link!
And as much as people complain about ebayer's being cheapskates I dropped my etsy prices and finally saw an increase in interest. It seems crafters want stuff to be almost as cheap as ebayers. I'm actually consistently surprised by how little almost everyone on etsy charges for their wares! That said, I'm not sure the early adopters to etsy are my target audience anyway. I tend to sell to non-crafters on ebay and in everyday life and they will pay more since they don't reflexively think "I could make that for less!" I am very much looking forward to etsy's future and I hope they will hit a critical mass of folks interested in items that are not mass produced. I just think it's a great site that could really build a reputation to rival ebay's.