PeopleSoft Component Interface from EXCELTOCI or Application Engine

Excel to Component Interface (ExceltoCI) is used when 

a. There is less number of records to in the component.
b. When the data being populated does not need require too much modification. 
c. You may encounter Excel rows limitation while using ExceltoCI.
d. it would be very useful for ad hoc request to load data in PeopleSoft.

For example you may want to load setup tables into PeopleSoft

Use App Engine to call Component Interface 

a. This method uses File Layout to populate the data in general. (This can also be overridden to increase the performance of the application engine).
b. The data which is populated can have modification.
c. There is no limitation on the number of records to be populated.

For example you may want to convert all employee data from legacy system to PeopleSoft.

There are number of other consideration to choose ExceltoCI or AE to call Component Interface, but we usually use ExceltoCI for adHoc request like one time upload or functional user wants to do by own.

Application Engine gives you flexibility to modify and confirm your business logic before loading data but usually require development effort.