Hello,
I did not use BGP confederation before, but it is common. Route reflector is a good option, but you need make a tree structure. In my opinion, router reflector is easier to config, but BGP confederation is more flexible. You can devide your main AS to several sub ASs with different administration groups and you can enjoy using EBGP behaviour between confederation groups.
I used RR before, but my network was structured in a tree form originilly, so I did not have any proplem to make a logical tree structure.
If the network is sporatic, sometimes RR is confusing to design due to RR rules regarding RR client and NON-client and so on.
You will have the same result with both in terms of the nexthop and propagation of attributes.
Masoud