Is it better to teach children to defend themselves against bullies or teach them to report the bullying ...?

I think you need to teach them self worth and encourage them to be strong enough to ignore bullies. I don't think teaching them to argue or fight can have any benefit and actually turns them into a bully themselves. Yes they should be able to stand up for themselves, but this is possible without the need for fighting. Even a child can learn this. I would also encourage them to tell a parent or teacher. That's what adults are for, to help children become responsible adults who know how to treat each other in a respectful way.