Cold setting is definitely the preferred method. The advantage of cold setting is that you can align the dropouts after the cold setting process. Aligning the dropouts alleviates the bending moment placed on axle due the misalignment caused by spreading the stays. This bending moment makes the axles more susceptible to bending, particularly on freewheel compatible hubs. Also, by just spreading the stays and inserting a hub, the stays will always be under stress, which can accelerate fatigue failures.


Spreading the stays will also misalign the derailleur hanger hanger relative to cogs, which often causes issues with indexed shifting systems. So, you're probably going to have to perform a cold set operation on the dropout anyway. So,you might as well do it after a cold set of the stays and avoid potential axle and frame failures issues.