If you're interested in augmented reality, you've probably thought about optical see-through and video see-through.
Is one better than the other? That's like asking whether a car is better than an plane. It depends on what you need to do: get groceries? the car is unmatched. Get from New York to San Francisco? a plane is very often your choice.
Video-see through systems present video feeds from cameras inside head-mounted devices. You can see an example here. This can be useful when you need to experience something remotely: a robot which you send to fix a leak inside a chemical plant; a vacation destination that you're thinking about. This is also useful when using an image enhancement system: a thermal imagery, night-vision devices, etc.
Optical see-through systems combine computer-generated imagery with "through the glasses" image of the real world, usually through a slanted semi-transparent mirror. If you are in a mission-critical application and you're concerned what happens should your power fail, an optical see-through solution will allow you to see something in that extreme situation. If you are concerned about the utmost image quality, portable cameras and fully-immersive head-mounted display can't match the "direct view" experience.
One aspect of video see-through systems is that it's much easier to match the video latency with the computer graphics latency. Latency (delay) is inherent to immersive imaging systems: motion trackers are not instantaneous; computer graphic generation is not immediate and even when refreshing images at 60, 70, even 120 Hz, there is a lag from sensing to imaging. When computer graphics need to be overlaid on the image from the actual world, there is a difference between video see-through and optical see-through. Optical see through offers no latency, which sounds great, except that there is an inherent mismatch or lack of synchronization between what you see through the glasses and the graphics. If you're showing a virtual sofa inside a real living room, this mismatch can be distracting. In contrast, using video see-through allows you to synchronize the delay so that your video and graphics are always in sync.
With optical and video see-through, no solution is perfect for all problems.