When considering the type of wood flooring you want to use, the specific application may dictate your options to some degree. However, if engineered flooring is among your options, the installation location possibilities are greater.
For example, solid wood flooring is not recommended for use in “below grade” applications, but engineered wood flooring can often be successfully used below grade. Below grade means the floor surface is below the level of the ground outside, such as in a basement. Solid wood flooring is not generally recommended for use below grade because the typically higher moisture levels may cause problems with excessive expansion of the floor boards. Basically, the flooring may swell too much after installation and therefore not lay flat. When wood flooring expands (or wood in general – boards, wood siding, etc), it expands more in width than in length, so the result of solid wood flooring installed below grade can be buckling – sometimes enough that it can push some flooring boards right up off the floor!
Engineered flooring often can be successfully used below grade because it is considerably more stable than solid wood flooring thanks to its multi-ply substrate. It still should not be used in a very high moisture situation (no wood flooring product should be), but it definitely gives you additional installation location possibilities that you might not have with solid wood flooring.
Additional installation location possibilities offered by the use of engineered wood flooring are any location where there are very large swings in humidity. Think about a home in Northern climates that heats with a wood stove in the winter, creating a very dry environment in the home, then in the summer has the doors and windows open during a period of warm, humid, muggy weather. This is an ideal application for engineered wood flooring because the seasonal changes in humidity (severe in this example) would be problematic for solid wood flooring, but tolerated far better by engineered wood flooring, thanks to its superior dimensional stability.