Both. When sailing 1-up I steer the boat so that I can collapse and fill the kite using only one armful of sheet. When the boat accelerates I try to steer with it to keep the kite flying, but if it does start to collapse I give it a quick yank on the sheet as this sorts it out faster.
Sailing 2-up, I try to do the same thing, but I find it much harder to steer to the wind when I haven't got my hand on the sheet.
Paul