Which is better, live performance or on your system?

Soundwise, yes more so in an outdoor concert and when multi bands use the stage, hi-fi may be better.
However, within a good concert hall setting and when instruments tend to be more acoustical, live performance far surpass hi-fi. Vocals, especially when good microphone techniques are deployed are the best live.
Small club settings in my opinion often yields the best both sound and visual.
The additional stimulant of live performances is of course the excitement of witnessing the whole visual experience and rapport with the performers.
Good live performances are always my benchmark for hi-fi.

bill: for me, this is a quite rare experience. while i have a 2-channel system many might think (as do i) is quite good, it usually bests live performances only when the acoustics of the live venue are poor, the amplification/speakers are lousy or i can get seats only in the nosebleed section. i've attended too few classical concerts of late but had the good fortune to accompany my older son to many great performances in the last year at several venues. seen dylan, phil lesh and paul simon twice each, csn&y, billy joel and elton john, hugh mesakela, cowboy junkies, john hartford, john prine, neil young & crazy horse, rat dog, string cheese incident, the eagles, david byrne, among others. the only times i've felt compelled to turn on my system when i've gotten home is when i've been to a blues/pop concert at the gothic or the paramount. john hammond was definitely better on cd than he was live. so, too, was odetta, the persuasions and iris dement. in each instance the acoustics were poor where i was sitting/standing. otherwise, i just can't match in my home the ambiance, the gut thumpin' bass, the banks of horns, the between-song patter or the sheer joy of just bein' there. -kelly

When sound is concerned it's my system,(except for classical) but with the tricky point of emotion, live performance wins hands down. It's simply to hard to get what most of us consider good sound out of a live performance. On the other side of that I have trouble getting the true emotional impact so easily found at a live performance out of my stereo.
Does that mean I need To upgrade my system??? Of course it does any excuse helps. But that emotion is the main reason I'll always turn off my better sounding stereo to go to a concert.