Milestones, because it reduces fiddly tracking of XP during the game and makes it easier to plan ahead on boss encounter difficulty. Plus it allows for a convenient time to level up while basking in the glory of their success!
Plus it doesn't encourage players to be XP seeking in their actions so they can play their character how they see their character.
The fiddliness of it is why I went with milestone as well. I do like the idea of rewarding players with additional XP for things like good ideas and such, but I guess that's what things like Inspiration and Hero Points are for.
Yes, non-XP bonuses for fun play are my preferences as well although I tend to prefer something immediate over things to use later. I get that the idea is making the player feel like they have a new choice, but my players tend to forget they have them to spend.
I used to use milestone but tried XP when I switched from 5e to Pathfinder 2e. Honestly I like the effect that XP has on players. They will do more side quests and just generally play the game more as a breadth-first search rather than just chasing whatever the next main objective is. It helps that in pf2e the encounter math is highly balanced for XP based levelling.
My GM uses milestones and I'm thankful for it. If we level up at the end of the night, everyone stays in chat for half an hour while we level up (usually me asking "is this a good feat to pick up?" because I'm a newbie) and it would suck to have to pause the session for that. Maybe not a big deal for veterans, though