CoolRebon explained it well. As to why you would want one or the other, I'd say it depends heavily on your class, what abilities you selected for your pirate, and how you play it. I find that when I play privateer I tend to stand in the back and give buffs and heals to my crew, letting them take the brunt of enemy attacks. Peaceful would tend to work for that strategy, letting my privateer take care of the rest of the crew. I've also known privateers who are very set up for melee and get right into the enemy swinging strong swords. If you have made your privateer into more of a melee tank, and have your musketeer or witchdoctor in the back, maybe you would want to be loud and keep the enemy attention on you. Swashbucklers can have such high dodge, keeping the enemy trying to hit you with loud, while you dodge might make good sense. It spares the rest of the crew. Same thing with the buccaneers.