in my opinion? definitely subdirectory. and in fact it will still be tidier on the server maintainability ..
For example please consider the following setup
you have your MYDOMAIN.com located at /var/www/html-mydomain
and by using a SUBDOMAIN.MYDOMAIN.COM, you will generally have them at /var/www/html-subdomain-mydomain
it looks tidier as you said it BUT you can achieve exactly the same thing using MOD_REWRITE
so perhaps right now your MYDOMAIN.com/SUB is located at /var/www/html-mydomain/SUB right? you can actually write a .htaccess that whenever user is going to MYDOMAIN.com/SUB it actually load the page under /var/www/html-subdomain-mydomain instead ! (so the server maintainability between using the subdirectory and subdomain will be exactly the same)
a much more technical example , put this inside your .htaccess of your root domain home directory
RewriteCond %{HTTP_HOST} ^[www\.]*sub-domain-name.domain-name.com [NC]
RewriteCond %{REQUEST_URI} !^/sub-domain-directory/.*
RewriteRule ^(.*) /sub-domain-directory/$1 [L]
This will cause the following situation
when people go to http://sub-domain-name.domain-name.com/a.html AND http://domain-name.com/sub-domain-directory/a.html
both of them will open your /sub-domain-directory/a.html instead
hope this help