As others have mentioned, I prefer Bitcoin itself for higher priced items, but I go with Satoshis for smaller transactions. Those are the two that I learned first and work most naturally for me.
I know the metric system applied to bitcoin "makes sense" but I have a miserable time keeping straight which is which between mBTC and uBTC, which could have gotten me in trouble a couple times. I agree that not having anything between satoshis and bitcoins creates a large awkward hole in the middle for items of moderate price. But somehow I just don't see "bits" or something similar catching on.
Hopefully Bitcoin pricing will continue to move up and someday 1 satoshi will actually be worth something! :-)
Yeah, it's all or nothing for me too. BTC for big prices, satoshi for anything that would qualify as everyday purchases, such as doing groceries type of money. I don't buy much stuff with Bitcoin so im sure in the future once it's more common to do so, people will just keep used to it. I have some friends in Europe and when they went from their national currency to the EUR it was a pain in the ass at first too, but people got used to it.