In undergraduate lectures, Prof. Gowers didn't give out notes in advance; all was written on the blackboard (from memory!) Sadly I never saw his graduate lectures, but I think they were the same.
Prof. Korner, in both undergrad. and grad. lectures, gave out notes with only the theorems and definitions, and did the proofs in the lectures.
I personally really enjoyed both approaches. I'm sure most people who've seen them will agree that they are both great lecturers (but their methods could lead to disaster if you're not a great lecturer).
As a student, I thought lectures with complete notes given out in advance were not bad, but they just didn't fire up my enthusiasm in the same way. The mystery and anticipation added excitement!
Of course there's no right answer, and different students will probably prefer different methods; you can't please all students all of the time (even pleasing some students any of the time can be difficult!)