This really depends on many factors local to your area.
The first is how good is your cable system. Have they upgraded their equipment? Are they all digital? Is the distribution system fiber or coax based? I know in my area, they haven't even come close to a full digital transmission, and half of their analog channels look horrible. They're still using an old coax network that they've simply beefed up the amplifiers on..and it's still not enough since they switched from having two head-ends to just one.
I've had satellite system with random times on both Directv and Dish Network since 1999 and I have to say I've overall been much happier with the service I've gotten from them than cable. It's true you have some hardware issues with satellite, but from what i've seen with the digital cable boxes..they've been known to spaz out too, much more frequently than a standard satellite reciever. Dish Network is pretty good about fixing hardware issues where as DirecTV doesn't.
As far as signal dropout...depending on the sattelite configuration you can usaully do things to reduce this. The first DSS system I used came with a 24" dish rather than the traditional 18", which that right there made rain-fade an absolute rarity. However, it's not that easy anymore since most of these systems are now pulling from multiple satellite locations and require a special dish configuration. You also need to consider the line-of-sight to the satellite locations, where as cable doesn't have this issue. It really helps if the person who installs and aims the dish takes the time to really tune in the signal.
It's true satellite has improved vs 5 to 10 years ago, but even 10 years ago it was better than most cable systems..