Which do you prefer?
I love them both, but Absol is one of the best looking Pokemon in the game. It's design is just so mysterious, imaginative, and original.
Which is more useful?
Absol again trumps Houndoom for me in this scenario. It has an interesting movepool, which can be useful in so many ways including the Swords Dance/Sucker Punch technique. Houndoom also has some interesting strategies and tactics up it's sleeve as well though.
Who would win in a battle?
Well they are pretty much evenly matched here, so I would say they both stand an equal chance of defeating each other.