Well, from what I understand, for most Canon cameras, the "standard" ISOs, 100, 200, 400, 800, 1600, and then whatever the camera sets as standard, are ISO that are "electronically amplified" from "base", where light collected is optimized as much as possible. For Canon, ISO 100 is considered a base. so, ISO 200 amplifies an ISO 100 by a stop.
The +1/3 intermediate ISOs are amplified by software, whereas the +2/3 intermediate ISOs are reduced from the next-highest ISO. So, ISO 125 is actually an ISO 100 shot that has been boosted by software by 1/3 of a stop so may have the "proper exposure" but will be more vulnerable to noise in the shadows, whereas an ISO 160 shot will actually be an ISO 200 shot, amplified electronically, then reduced in software. It will have less shadow noise because you have actually brought down exposure, but will have less latitude in the highlights.
Then, the High and Low ISO follow a similar pattern -- Low ISOs will lower the exposure of the next "real" ISO up, so that ISO 50 allows a slower shutter speed then takes that overexposed shot and lowers the exposure in software by a stop. In the same way an "H" ISO will allow an underexposed shot and boost it by a stop.
In short, I'd say that if you are shooting jpeg, use what will give you the best results out-of-the-camera and let the camera do it's calculations, but if shooting Raw, you can match or beat those results if you understand the ideas involved.
I've heard that some Canon cameras have more "real" ISO range, as in the 1D series, but I haven't seen the evidence for that.