How do you decide between engineered hardwood floors and natural hardwood floors?

If we can nail it down we use (prefinished) hardwood. If we have to glue it down (on slab) we use engineered.

You can certainly use engineered in any application whether nail down, glue down, or even floating. There really aren't many compelling reasons to use solid anymore beyond prestige and the fact that is has zero chemical emissions. Engineered can be refinished just like solid, as long as the top veneer is think enough. If you plan to be in your house long enough to refinish the floor, use an engineered with a 3mm+ top veneer.