AES vs Blowfish for file encryption

Probably AES. Blowfish was the direct predecessor to Twofish. Twofish was Bruce Schneier's entry into the competition that produced AES. It was judged as inferior to an entry named Rijndael, which was what became AES.

Interesting aside: at one point in the competition, all the entrants were asked to give their opinion of how the ciphers ranked. It's probably no surprise that each team picked its own entry as the best -- but every other team picked Rijndael as the second best.

That said, there are some basic differences in the basic goals of Blowfish vs. AES that can (arguably) favor Blowfish in terms of absolute security. In particular, Blowfish attempts to make a brute-force (key-exhaustion) attack difficult by making the initial key setup a fairly slow operation. For a normal user, this is of little consequence (it's still less than a millisecond) but if you're trying out millions of keys per second to break it, the difference is quite substantial.

In the end, I don't see that as a major advantage, however. I'd generally recommend AES. My next choices would probably be Serpent, MARS and Twofish in that order. Blowfish would come somewhere after those (though there are a couple of others that I'd probably recommend ahead of Blowfish).

It is a not-often-acknowledged fact that the block size of a block cipher is also an important security consideration (though nowhere near as important as the key size).

Blowfish (and most other block ciphers of the same era, like 3DES and IDEA) have a 64 bit block size, which is considered insufficient for the large file sizes which are common these days (the larger the file, and the smaller the block size, the higher the probability of a repeated block in the ciphertext - and such repeated blocks are extremely useful in cryptanalysis).

AES, on the other hand, has a 128 bit block size. This consideration alone is justification to use AES instead of Blowfish.