Which domain should I use?

Ok so here is my domain dilemma..

I am trying to decide which domain to select for a midsize project. I may be over analyzing the situation but I want to pick the best out of the two for seo and branding.

Domain #1 is a short well aged .COM domain with a number in it replacing a letter. similar to T3ST.COM (11 yrs aged)

The other domain is a new domain but has a keyword in it.
similar to COOLSITE.COM (new domain)

Now one more thing to consider.. T3ST.COM has a large well branded (indirect) competitor with TEST.COM as there main domain.

This could pose a problem in the future since both companies are named "TEST"

Also I am not a big fan of 1337 speak domains. While yes it is a short aged domain.. the fact that it's leet is kind of annoying. But if the domain age is going to give me that much more authority and or keep me out of the sandbox I'll run with it.. Please any help direction would be great!

Don't use the first domain. Brand around the second.

Unless you have fantastically killer branding and a significantly different market, you'll lose a majority of your type-in traffic to the first site, and possibly get sued by your competitor into the bargain. Stay away from that.

IMHO, get them both. Brand around the second as CSA suggests, and 301 redir or clone the first to the second. That way you can have a buffer (the aged name) and even if you get WIPO'd out of it, you haven't lost that much (you still have the new name).

It's not accurate that only tech companies are interested in pursuing C&D's. As far as getting sued, that's a matter of your own risk tolerance. I've seen "my name" show in up more than one class-action suit or takedown notice, there's ways to deal with it, it all depends on how far you want to push it. There's a really good thread by cadkins45 (I think that's his username - know it starts with cadkins) about TM's on bhw you might want to peruse.

And I know what you mean about 1l333t sounding names philosophically, but from a monetary point of view I haven't found a single digit in a name to be that much of a degradation in the name's value.

When dealing with Search Engines, putting a number in place of a letter won't help on keywords. Use the domain with keywords, as I've gotten them into google and yahoo within a week even on new domains.