IMHO, i think it all depends on the preference of you and your cham, as well as the fullness of cage (which is one of your concerns). Chams arent really hunters, so left over food could pose a threat to a sleeping chameleon.
though free ranging also have the benefit of extra and faster movement & exercises for the cham, as well as exercising the range and distance the cham shoots it's tongue. cup feeding all the time can cause the chameleon to become lazy with it's tongue, thus, weakening it as time goes by. (i do a bit of both)
free ranging also promotes longer feeding times, which IMO results in a healthier speed of eating.
i do not like free ranging worms though, unless i see the chameleon eat it in front of me. superworms will burrow in live plants, silk/hornworms will find those dark corners and make a VERY messy cocoon.
again, my preference is doing both, as both have pros and cons, and at times some quicker than others. it all depends.