i would use the freewheel that fits the dropouts best. if the spacing is 120ish, use a 5-speed. if the spacing is closer to 126mm, use a 6- or 7-speed.

i have a project now that came with a 5-speed, but the drops measure about 125mm. the hub o.l.d. is well short of that, so the skewer is asked to pull the drops together significantly. the axle is only 130mm. so i went to the co-op, bought a used 133mm axle and am converting it to a 6-speed the frame will better fit.

for me, it's all about the frame. i don't like anything to fit tight or short of perfect. if i get a rear flat out on the road, i don't want to struggle with removing the rear wheel. it should simply "dropout."