We are probably 90% coach throwing in front of mound; 10% live arm...(we are lucky, I have 3 guys who throw good bp; it isn't always that way trust me)
I use a machine to get a good defensive workout. The machine throws to the JV team and the Varsity plays defense against that... a nice meatball setting and the JV guys can hit some shots, run the bases and put a lot of pressure on the defense (allow about a 20 foot leadoff draw a 'finish line' at 80 feet for the JV kid to be safe at first on this to make up for speed diff. of JV)
of course we use the cage too, (coach throwing and machine) but hitting on a field, I feel, is 10x better than hitting in a cage.
To your question what would be more beneficial? In a perfect world, there would be enough time and pitchers so that your kids could experience about 5 "live" at bats every day and bp from coach, 15-25 cuts, some soft toss and tee work. Logistically, the 5 'live' at bats just cannot happen due to time and resources.