Data first Code First

Code first

• Very popular because hardcore programmers don't like any kind of designers and defining mapping in EDMX xml is too complex.
• Full control over the code (no autogenerated code which is hard to modify).
• General expectation is that you do not bother with DB. DB is just a storage with no logic. EF will handle creation and you don't want to know how it does the job.
• Manual changes to database will be most probably lost because your code defines the database.

Database first

• Very popular if you have DB designed by DBAs, developed separately or if you have existing DB.
• You will let EF create entities for you and after modification of mapping you will generate POCO entities.
• If you want additional features in POCO entities you must either T4 modify template or use partial classes.
• Manual changes to the database are possible because the database defines your domain model. You can always update model from database (this feature works quite good).
• I often use this together VS Database projects (only Premium and Ultimate version).

I expect that in case of EF 4.1 there are several other features related to Code First vs. Model/Database first. Fluent API used in Code first doesn't offer all features of EDMX. I expect that features like stored procedures mapping, query views, defining views etc. works when using Model/Database first and DbContext (I didn't try it yet) but they don't in Code first.