Lets break this down.
Coverage Distance:
This is heavily based on your individual abilities, and the 'presumed' abilities of the recievers you are covering. Close coverage is really only applicable when you're not at a serious disadvantage. For instance, if you're covering a reciever about eight to ten levels higher than you, you can bet their attributes will be higher than yours- perhaps to the point where they'll break your ankles or leave you in the dust. This kind of matchup is where you want a cushion in order to negate some of the chances that your opponent will make big plays. The really large cushions, however, only make sense if the opposing reciever has an even higher advantage in levels than you.
Coverage Style:
There is some emphasis on your attributes versus those of the opposing reciever, but ultimately what determines this tactic is the attributes and usage of the safeties on your team. If you go aggressive, you'd damn well better have a top-notch safety covering your arse. If he can't speed into your area like a bullet and run circles on the field, that reciever you're covering is gonna have more big plays than you will. A lot more. Going entirely conservative is probably the best choice if you either have no faith in your safeties or your own attributes. A 'Medium' style probably works the best overall- less big plays for the reciever and perhaps more big plays for you without getting burned all the time.