Should I choose KVM or OpenVZ for my VPS?
KVM does not provide anywhere near the performance of OpenVZ (or Virtuozzo, its commercial equivalent). It's extremely important to note that KVM requires a running kernel inside the VPS, whereas OpenVZ runs containers using a shared kernel. This means that a 256MB KVM VPS does not actually have the same amount of memory available to userspace that OpenVZ does. OpenVZ is an extremely lightweight virtualization technology that easily outperforms full virtualization.
KVM does provide better isolation, although this isn't usually apparent to userspace in a container.
As for the original question, if I were shopping for a VPS, there are two factors to consider:
1) At the same price point, you'll get less for your money with KVM. 256MB of KVM is less than 256MB of OpenVZ because you have to run your own kernel so there's less for your actual applications. On the other hand, some hosters charge more for OpenVZ, so you'll need to do the math.
2) It's easier for hosting companies to overcommit OpenVZ systems, so bad hosting companies may put you on a system with too many containers, so be wary of this.