I think, technically speaking, alphabetic makes the most sense. A directory is supposed to be a reference catalog of websites. Most reference works are sorted alphabetically.
Alphabetic makes sense the problem is that sites starting with “A†get and advantage, but that also happens on all other regular off-line listings.
The one option I would suggest NEVER to use is alphabetical. If you list alphabetically, then you will be constantly spammed with crazy looking titles who are simply trying to out-alphabetize the next guy. I personally like hits, but PR sorting is not bad either.
I've seen alphabetical work fairly well when the site name must be used. For the most part folks with names like 0-directory blah blah are going to have spammy sites that won't pass a professional directory owner's scrutiny. PR only works if the directory owner keeps it current. When my hard work finally gets rewarded and G gives my site the PR it deserves - my original PR0 listing really sucks. My site is in order by submission - oldest sites first. Why shouldn't the people who submitted early when traffic and PR was low get something for their early participation? Latecomers can always buy featured placement and I, as the site owner, need to keep adding/moving things around so that one category doesn't have 500 submissions and another 5.