I think snippets are a good place to start. But people should consider just laying down 3-5 songs pro bono. We recently mailed out a CDr to about 100 people. I got nothing but positive feedback, the discs had from 3-5 songs on them (we mixed it up) and they were all full songs.
People who had already bought our album, I sent out 13 newer songs to, but 3 or 4 of them were snippets. I thin the big thing is that you have to convince people that you're better than just one good verse. After 3 or 4 songs people have an idea of how good you probably are or are not.
I just know that when I get a snippet CD, I am VERY quick with the eject button. I had to twist some of our artists arms to get them to understand that snippets are not going to get it done. What were they afraid of... the song being copied and burned. I had to convince them that they, as new artists, WANT the song copied and burned. Feel me. To each his own. I have seen bigger artists go the "full-song" route, too. Seems like 3 songs is the standard.