Which one is the best and why?

It depends. The Reseller account is cheaper and frees you from the technical nitty gritty of the business and allows you to just concentrate on marketing, planning and support your clients.

A Dedicated Server would be nice because you are not sharing the server with anyone and you could manage the number of web sites on each server so as to provide for the optimum performance that they may require. You could probably pack more customers in there compared to the resellers account and you could configure the server to your own liking and install scripts and programs which your clients needs. However on the downside, you will need to be tech savvy and be able to manage, configure and troubleshoot the server. In terms of cost per client, it is usually lower than that of the reseller's account but overall it can be costier.

Co-Location is like the Dedicated Server hosting, the only thing is that instead of leasing a server from the web host, you are supplying your own hardware. This would allow you to determine what you want in your machine in terms of hardware. And may be the best alternative if your application requires unique hardware or that you are using an OS which the web host does not support such as Mac OS X. The downside is that because it might be unstandard hardware, if there is any hardware issues, you will have to resolve it yourself.

WoW! Thanks EDDY - Great info:D

Anyone else have opinions on what they prefer?