When to consider base64 (DATA: URI) images?

Question

What are the factors that should trigger thinking about switching images over to Base64 embedded in CSS?

There seems to be a lot of generic pro/con type things out there

Answer 1

Are there are key factors I should be looking for (both pro/con)?

The biggest con is the missing support in IE6/7, and the incomplete support in IE8 (data: URIs must not be larger than 32 kilobytes there).

Using CSS sprites is the vastly superior technique in this case.