I tend to assume my readers are busy people, and therefore lean towards shorter chapters. This allows for as many breaks as the reader needs. The chapters are short enough that the reader can stop, but connected enough that they can keep reading without interrupting the flow of the story.
As to where the paragraph breaks occur...that is difficult to pin down. I don't like to end a chapter on action just to start it up again in the next chapter. However, I will end on action and move on to a different scene. Knowing when to make this a section break or a new chapter is more instinct than anything else. This is especially true in the fourth book of my series, which involves a lot of battles. I had to jump around to different characters a lot, and you can't do that without a section break or new chapter.
I also tend to have more than one story going on at a time, so I have to jump between them with care. I'm working on Max's second book right now. In it, there are two seemingly unrelated stories evolving together, and they don't sync until near the end.
After I finish a draft, I do a lot of editing; this includes re-arranging chapters and so forth. I've split up chapters or combined to shorter sections to make a new chapter. I'm kind of obsessive about it, but really I think it's just about the flow of the story.