I am planning a game with a large terrain and there will be lots of trees and bushes. The guy that helps me told me that we should use models for trees because they are (or can be) much nicer than sprites.
Have a look at the infinite_terrain.c sample, it's a combination of sprites and models. The answer of your question depends on the type of game that you are making, if it is first person, sprites are way too outdated for trees at close distance but can be used as a LOD stage.
"Falls das Resultat nicht einfach nur dermassen gut aussieht, sollten Sie nochmal von vorn anfangen..." - Manual