I add some dirt to an existing mountain to flatten the top a bit and then build on top of that.
Funny, my current house started as a simple holow natrural rock formation on the very top of a mountain I used as shelter on myfirst night.
I then added a large layer of dirt on top of it and builded a tower house on that. That initial shelter is now my basement.
I voted both, but I usually build along with the terrain. My first world is just so beautiful, I didn't want to ruin it by building a bunch of ugly structures everywhere. My base started off as a hole in the wall of a mountain, and I've kinda gone with that theme for a long time. Something about a mountain with giant glass windows and a few balconies jutting out just looks imposing. That being said, I do sometimes terraform, but its nothing too major. I've only really replaced a small hill next to my base with my minecart station and warehouse and filled in the dry lakebed that I spawned in.