Here's the question to ask yourself:
Will your SQL Server ever need to access another computer on the domain? In other words, will you ever want to backup to another computer/server? Will you ever want the results of a job to be saved elsewhere on the network?
If so, then a local account won't work - SQL Server will need a domain account to be able to access domain computers/servers.
Basically that's it.....what computers/servers do you want SQL Server to be able to access?
-SQLBill