We've done it both ways and have mixed hand lettering (boat name) with hailing port (vinyl). The vinyl holds up better against fiberglass cleaners and won't scrape off like paint.
We also had a boat with a painted, engraved signboard for 16 years. It was classy, but had to be repainted periodically.
Bottom line: vinyl is cheaper and doesn't look that bad and will hold up better than paint. If you want permanence, see if you can get someone to letter in Awlgrip.