I've done hikes both ways. Although no underwear is 'freeing' and no worries about chaffing, I found my capris smelled like a urinal after 3 days. I now add either Burts Bee baby powder (no talc) or Trail Toes anti friction.
Underwear, but even though I'm a girl I strongly recommend boxers. Small men's usually fit me perfectly (with no giant crotch bulge or anything weird) and they're a wonder for hiking and active stuff