Ignoring commercial concerns such as marketing campaigns, complimentary events, and market conditions, this essentially comes down to weighing the quality/completeness of the product against getting to market sooner.
The quality over time to market side has been advocated a few times in recent episodes of Paul Boag's podcast, so I figured I would speak up for the other side. But before I do, let me just say that I don't think there is a right answer to this and, as Paul also conceded, it depends on if your application's success requires a land grab or not.
I am, by nature, an "early and often" man - and that's kind of a vote for time to market over quality. I say kind of because I think it would be more accurate to say that it's a vote for time to market over perfection.
For me, the "often" part is inextricable linked to the "early" part. If you can show a pattern of frequent, regular improvement and feature releases, then you can afford to ship with less on day one. Users can often be more forgiving when see things turned around quickly, and new things regularly appearing can even become a reason in itself to return to the site more often.
Quality is still a factor, but it isn't as black and white as I've been hearing it presented. In the early days of a new product, I think where you spend your time is more important than overall quality. You should be very confident in anything that deals with accounts, real money, or the custody of user's data before shipping. I would argue that getting those areas right for launch at the expense of other parts of the system is better than a more even systemwide standard of quality. You always have limited resources. Spend the most where it counts the most.
And finally, openness. Be truthful and transparent with your users. Start a blog about development progress and the issues you've run into. Provide feedback mechanisms, and actually get back to people who've taken the time to share their thoughts - with something material too, not just an automated thankyou. Send out proactive notifications ahead of impactful changes and after unplanned events. Stick 'beta' labels on things you're shipping early - it'll keep user's blood pressure down, and you might be surprised by how much of the community is prepared to help.
I am aware that I haven't actually answered the question that lends this post its title. I don't know if there even is an off-the-shelf answer, but I hope that I've at least given you some more ideas on how to make the right decision for yourself.
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