Longer cranks are for longer legs, so it depends on your body size and type, but it really just comes down to rider preference. Some like the extra torque you get with longer cranks, others say you can't spin 'em as fast or that they will hurt your knees. There is a lot of discussion on this in the road bike forum, you might want to check it out.

Yes, a longer crank arm will require a slight saddle adjustment down, because the pedal will now be farther away in the down stroke.

http://www.sheldonbrown.com/cranks.html