Experience tells me to manage it yourself in terms of shrinking (when it happens, what is going on and sync it with other jobs that may be going on). The trick to watch a little more carefully I believe is your growth settings and not chewing space that perhaps wont be used for sometime. Managing transaction log space utilisation is another tricky one, especially if you have the occasional very large job that blows out the log size.
Btw, I havent measured the performance hit whilst files are expanding or shrinking during heavy IO... I like to monitor growth and get a feel for this to ensure files cater for the expansion (reserved space) without sqlserver working to grab more space.
The close option is a silly one and I never set it. I have come across some issues of connections locking up and blocking because of it. Its probably been resolved between versions etc etc but I cant see any logical value in it.
Author of "SQL Server Backup, Recovery & Troubleshooting"
Author of "SQL Server 2k for the Oracle DBA"