Using a Wiki
Given the pros and cons, we'd say your project could use a wiki if there aren't too many of you involved, you don't need to work in public, you're able to do all or most of your work on the wiki (constant exposure is important), and your project is really big.
That said, here are some specific tips when you've decided you're ready to dive into wiki world:
Keep all of your notes on the wiki! Don't make the wiki page too stressful to edit. If you have to write a title, or date, or your initials, or even keep things neat when you make a note--you might not do it. If you have an idea, you want to be able to click Edit, note it at the bottom, and close the window. In this spirit, keep a permanent link to the wiki in your browser toolbar.
Use attachments. Use lots of attachments, uploading PDF and images when you can, and keep lots of references and links on the wiki. Don't keep any supporting material on your computer.
It's all about getting used to the wiki. Use WikiWords everywhere. We had all of our article titles in WikiTitleCase pretty much until we were forced to give them proper titles. This meant we knew our way around the wiki like the backs of our hands, and could make paper notes that could be easily reconciled with the wiki later.
Don't be uptight about using the wiki for collaboration. Yes, everything should live there, but don't try to work on the same page in the same day or two. You want a good understanding of what's where, and that means nothing changing under your feet. Talk to people to pick up topics. If you're actively working on the same document, break it up into a few pages.
If you need to move off of the wiki to finish what you're working on, that's good too: yes, a wiki is good for collaboration, but it's more important to have a shared memory than a shared workspace. If you need to work off of the wiki in a Word doc with Track Changes on, or bouncing a text file around in email do that.
Use the wiki when it reduces your workload. You don't need to be strict among a tiny number of people. Wikis happen to be good for collaboration, yes, but what they're really really good for is being a space where it's really fast to write things down and find them again.
Read: Internet Options
