There's a couple factors:

1. How special is the bike?
2. How much time and money do you have?

My personal opinion is that bikes should be ridden. If an ugly, beat up finish keeps you from riding it, and you don't have the money, time, interest in a complete finish restoration, then powdercoat. There's nothing to stop you or somebody else from redoing the finish later if they so desire.

The problem with a restoration is that you might be afraid to ride it the way it should be ridden. You'll live in fear of damaging the finish or nicking a decal and you won't ride the bike.

My feelings change a bit if the bike itself has some history that you're trying to preserve. There are also many people who enjoy the work involved in restoring the finish to like new, but that's different than doing it out of some sense of obligation. Ultimately a bike is just a thing that was created with a purpose in mind, and that purpose was not to be hung on a wall.

In other words, if restoring the original finish leads to a bike not being ridden, that is a greater violation of the spirit of the machine. Better to make it a fixie