All of the above, sorta.
Most steels will change in relationship between their toughness and potential for edge holding depending on the hardness. A general statement would be that the lower the Rockwell hardness, the tougher the blade, or the more shock and impact resistant it is, down to the point that the steel is spring tempered, Rc 48-50. At the same time, the edge holding, or what they call abrasion resistance, increases as the hardness increases, until it reaches the point that it becomes too brittle, and will chip if used hard.
Corduroy made a good point. Each steel is different, and each has a certain point where the tradeoffs become more extreme. Heat treat ATS-34 too hard, and it becomes brittle. Heat treat 440C fairly soft Rc 56-57, and it is not the best at edge holding, but it is very impact resistant, much more than the other 'stainless' steels.
Something like 5160 spring steel is optomized when the hardness of the edge is Rc57-58, since it retains a lot of the toughness it is capable of. Differentially heat treating it so that the back is softer will make it even better.
Some of the new powdered metal technology steels are interesting, since they seem capable of combining the toughness of tool or spring steels, with better edge holding. I've been trying some CPM3V, and it can be used at a fairly high Rc, 59-60, and testing so far seems to indicate that it can hold an edge similar to a harder piece of D-2, but be as tough as a piece of 5160 tempered softer. For a heavy use knife, that is a good combination for all but those who want the steel to be a bit softer and easier to sharpen. According to the manufacturers specs, it too can be pushed even harder, with even better edge holding, but past Rc60, the impact resistance drops off substantially.
A lot depends on what you want to use the steel for, and what you value most, toughness, edge holding, ease of maintenance, or whatever. A lot of folks would be served better by something like a 1095 or 5160 carbon steel blade, or something like 440C stainless. The first are tough and very easy to sharpen, and the other is fairly tough, not bad to sharpen, and corrosion resistant enough to require little maintenance.
The higher end tool steels, like D-2 and M-2 and the new stainless steels, like BG-42, and CPM steels work very well, but the user has to know better how to sharpen them, since they are so good at edge holding. That also means that they also want to stay dull longer too!
madpoet