SharePoint Online can be accessed either using SharePoint's own native REST API, or, using Microsoft Graph API. I have briefly explored both of the APIs and see differences in terms of the capability, for example, SharePoint API has function type method calls (GetByTitle()), whereas the Graph API seems to support identity based access, or, 'site path'. My opinion is that SharePoint makes it easy to access resources through the use of 'function' in URL, however, i am not sure if it is RESTful. It would be helpful to have your views on this aspect.
Given the two options (SharePoint & Graph) which is the recommended way forward, considering below criteria's:
Also, I couldn't find any Microsoft recommendations on this, if there is one kindly share the link.
Thanks.
I recommend Microsoft Graph API. I know it is a proxy to actual Sharepoint, OneNote, Planner, and etc API, but the way they are improving graph api day by day makes me think it is going to last for a good time. Let's say if you are writing an app that wants to connect with many Microsoft apps endpoints, having one class that handles all the graph api requests is enough instead of looking for specific apps endpoints.
Performance: I have been using Microsoft graph api for most of SharePoint related work and it works good and fast. I use Graph explorer to check out the graph if it actually works before implementing it in the app.
Functionality Coverage: Obviously graph is a proxy of a real api so it won't cover all the processes you need to do in SharePoint. For example, I had to create a Sharepoint Group which I could not find a way via graph api. But I assume as more people vote on those requests, the graph api is bringing those new possible proxy endpoints too. But again if your app is only working with Sharepoint then I believe I would stick to SharePoint API. In favor of Graph API, they also have something called delta query and subscription notification to see changes in the files and documents.