Unless there is a priority target to kill first because of a mechanic or damage taken, you should always choose the option that does the most DPS. Large pack of mobs? AoE is generally the best way to go.

In dungeons, you basically want to AoE everything down. So it is bad if you pull hate from a group of mobs that takes them far from the group. You want all the enemies to be bunched together to facilitate AoE from everyone in the party. You do not want to line of sight (LoS) a caster or cause other players to miss their AoEs.