Right, that thread title with that username... that has to get a response
As for the game, it depends heavily on which mods your using (if any). In the stock game, from what I can recall, magnetic is the way to go with anything bigger than really small, and definitely for warships. With the possible exception op the C3 cargo, an impact eel at 5m fired when the front of the bridge reaches the vertical line of your crosshair will kill those with 1 eel almost every time.
With (super)mods added it becomes a different ball game, they have different damage models and malfunction situations. I can only speak for GWX here with any authority.
For GWX it's best to go for Impact before say september 1940, because the problems that plagued the Germans with the early torpedoes are moddeled. and magnetic eels are far more prone to malfunction. Later on it becomes a matter of what is practical, impact for the good angle on bow shots, magnetic for the bad AOBs, oh and for Battleships, those have serious side armour and torpedo bulges and whatnot, but 2 or even 1 well-placed magnetic eel can sink them.
As for the historical perspective, it wasn't in fact a matter of choice, eels came with either an impact detonator or magnetic influence and impact, and it wasn't possible to flick a switch to select like in the game. to make adjustments the eel had to be opened up and adjusted. Bit of a bother if it's in the tube and there's this big ole merchant about to cross your bow.
The early German eels had problems with depth-keeping, which showed up most dramatically during the Norway campaign, after that Captains were ordered to only use the Impact detonator and remove the magnetic until late 1940 when the problem had been fixed.
I'm not too sure about what's best in game, I prefer to use impact except for when the situation calls for it. I try to avoid using magnetics in bad weather or long range because they're more likely to malfunction. So for reliability, choose Impact