Both of them are good ones. They just have pretty different uses.
OpenVZ has a shared kernel, while KVM/XEN VPS have an isolated kernel. Both have pros and cons.
I'm a fan of OpenVZ due to its backup safety and performance. But if you plan to have a custom kernel, you should definately go for XEN or KVM.
Why you should choose OpenVZ vps Hosting ?
* Better performance
* Ideal for those who use CentOS and/or cPanel
* Very easier to generate/manage backups
Why to choose KVM/XEN ?
* Isolated kernel.
* Compatible with ANY operating system. Windows, Debian, Ubuntu, etc.
* Possible to upgrade the kernel freely.
Why NOT to choose OpenVZ VPS Hosting ?
* Poor compatibility with Debian, Ubuntu, etc.
* Doesn't support Kernel upgrades for most of the linux distros (because the kernel is shared)
Why NOT to choose KVM/XEN ?
* Their backup system is complex. Many handwork is necessary to keep track of it.
* They work based in LVM only (in the hardware node)
* Poor performance if compared to OpenVZ