Ubuntu is nice and tends to have up to date packages.
Centos doesn't always have the latest but certainly isn't far behind, and because its based on RHEL it is very stable (RHEL has commercial investment).
You'd be fine with either of these.
In terms of setup, I've taken cues from others and used:
NGINX (Webserver -
http://nginx.org/)
PHP-FPM (FastCGI Process Manager -
http://php-fpm.org/)
APC (Caching -
http://php.net/manual/en/book.apc.php)
Separate DB server that only has mysql, firewall and Munin (node monitoring).
Very impressed with this setup - NGINX has consistently fast response times, and the APC cache helps a lot.
I have a guide here for setting up an Ubuntu webstack in one hour, but I've yet to add Part3 (firewall + postfix - trivial enough to do).
http://blog.thenewmanifesto.com/2011/09/setting-up-webstack-software-on-ubuntu.html
http://blog.thenewmanifesto.com/2011/09/setting-up-web-server-on-ubuntu-11-part.html
This has been tested by myself and others on Ubuntu 10 + 11 LTS (UBU10 has slightly different paths as I remember).
Its not as complete as it should be, and I need to update some of the config examples, but if you follow along on a test box you should have a webstack that you can expand upon easily.
Important to note that you need to compile PHP yourself with this setup because the Ubuntu install (via yum) doesn't have all of the required php-fpm flags.
I'm a bit busy for a couple of days, but if you can bear with me, on Friday 19th October I'll double check and make sure it has my latest config settings and that all of the resource files are bang up to date.
If you need any pointers in the meantime, feel free to get in touch.