What is the best way to play Tactics? Real-time or turned based?

It depends on what do you prefer. I played it all in real-time mode and I hadn't any problems and I was satisfied. The turn-based mod may be good for a few mods where you're playing only one character like in old Fallouts, but if you want some hardcore tactical action in wasteland, I recommend real-time mod.

having played it several times, I'd suggest taking a couple of soliders with hunting rifles [preety high small guns required] than make them go together and shot at sight [probalility more than 66%], this works in the early missions and then with those rotots as well,
too bad this turn-based system still makes your enemy fire when you step into his sight line, even though it's your turn! that kind of suk*, but you can get used to it

I play it this way:
- moving across map, easy fights (like weak enemies or many vs single enemy) -> real time
- other fights -> turn based

I'll probably end up taking your advice.
I played years ago using real-time, simply because I hated turn based games.
But after finally playing Fallout 1 recently (Can't believe I missed such a great game), I grew to love how the combat was handled.
I'll have to give Tactics another go after beating Fallout 2...

better turn based xp
On real-time is freaking hard to pass this game xp
Special when fighting againsts mutants (specially 1st mission) and mechs xp

Squad turn based works very well for situations where you absolutely need to be able to control your party quickly. I'd strongly suggest setting it to that for at least situations like Quncy's hostage rooms. (It's nearly impossible to rush the power plant in realtime without getting hostages killed or the generators blown up.)
Otherwise, you can play much of the game in realtime, using sentry mode to fire at the bad guys. I acutely prefer turn based, as it gives you a chance to employ more complex plans.