I seem to have been in a similar position as you in regards to what type of bike to get and getting a frame made of aluminum vs. steel, etc. I test rode a bunch including several aluminum frames that were great bikes but after riding them one thing became very clear: they were rough(er) rides compared to steel. I read tons of articles, threads here and opinions for/against both steel and aluminum and for me all that research was confirmed after my first test ride of aluminum then steel. Is steel heavier? I'm sure it is. Does it matter? No way...at least not for MY purposes (exercise, transportation). If you were racing or weight was a huge concern, maybe it becomes more of an issue, but for me the benefits of steel (namely the super smooth ride) more than makes up for a handful of added ounces over aluminum. I'm guessing you're probably in a similar boat.

I ended up getting a Traitor Ruben (a cyclocross) and I could not be happier, a huge part of that being how effing smooth the bike feels. The bike absorbs an incredible amount of little bumps and the road in general and when you do ride over a bigger seam in the road or cracks/bumps you feel it but it feels less than it "should" if that makes sense. I've not ridden it off-road yet but I can't imagine it would be any different in terms of absorbing bumps and vibrations...I'm actually pretty excited to try it out off road to see how well it feels!

I vote steel, no question about it.