Either way is fine with me - watching a woman pleasure herself is immensely enjoyable and arousing.
My wife masturbates with me watching to get herself hot for sex and to give herself a climax. It's always a prelude to me fucking her. She says masturbating to orgasm gets her much more sensitive for another orgasm from my cock up her. So I just watch her while she masturbates to climax but as I watch Ifinger my cock so it's at the peak of readiness to get in and give her another one.