I sometimes do both in one seam. Pinning parallel to the cut edge at 1/4 inch lets me see that previous seams will match up; it's especially helpful when a diagonal seam meets a right-angle seam and I'm sewing the patches together. (is this making sense?) I always have the head of the pin toward me, and pull out slowly as I stitch toward it. But in general, pinning perpendicular to the cut edge is recommended because the wiggle of fabric along the seam line is less.