This is actually a real-life question I am facing. I'm just looking for some general opinions hopefully from people who have run teams before.

If you were hiring an artist for your team, but you can only afford one of them, which would you choose:

1- The guy who is an awesome concept artist, and a middling 3D Environment artist

2- The guy is is an awesome 3D Environment artist, and a middling concept artist

First impression is that number 2 would be the best, it's the art that actually goes in your game that matters right?

But then a better concept artist means your environment will be more imaginative, more atmospheric (these 2 elements are very important to my game). There's no point in quality 3D work if the level is boring right?

I think 3D artists are more expensive than concept artists so there's more to weigh than you think.

If you were hiring an artist for your team, but you can only afford one of them, which would you choose:
1- The guy who is an awesome concept artist, and a middling 3D Environment artist
2- The guy is is an awesome 3D Environment artist, and a middling concept artist

a. It depends.

b. Neither (I'd wait until I could afford to make my game, or I'd change my plan).

c. Neither (I'd hire someone else -- I'd keep looking).

It looks like you as the employer don't know your own needs.

Figure out what you actually need. Then hire to meet those needs.

If you require two individuals, then that is your need and hire accordingly. If you require one individual who has talents in both, then that is your need and hire accordingly. If your requirements exceed your budget, then adjust something until they are aligned.

First impression is that number 2 would be the best, it's the art that actually goes in your game that matters right?

But then a better concept artist means your environment will be more imaginative, more atmospheric (these 2 elements are very important to my game). There's no point in quality 3D work if the level is boring right?

Just thought I toss out there that all your creativity should not be coming from your concept artist. You end up making your 3D artist sound like mindless drones. Hopefully, that's not what they are.

That's not to say concept artist are not important to a project. They help set the direction and all that goodness. But, other artist must be allowed to shine too. Especially when translating concept to reality.

1) What frob and Tom said : work out your requirements first! You need to do some proper project planning...

2) From your planning you should realise that most projects naturally break into phases (e.g. concept, pre-production, production, marketing, debug, ship, post-launch).

3) You'll probably need both artists, but not for the entire project - so work out what phases you need each for and contract accordingly. It's likely you'll need each multiple times - for example the concept artist can help prepare your marketing materials.

4) If you have a genuine tie-break situation (e.g. two 3D artists who are equally as strong on paper and at interview), go for the one who's personality will best fit with the personality of the team (the whole team - even a team of remote workers),