I just went through this same questioning for a free tool for analyzing press releases (http://www.pressreleasegrader.com)

Based on this recent experience (and past experience), I generally lean towards just getting it out there and then iterating like hell.

Closed betas are nice to "control the flow", but most products don't have a "flood of traffic" problem, but a "nobody cares" problem.

Make it easy for people to try it out and give feedback, and respond swiftly to the feedback.