Q: Vertical vrs Hortizontal

I would say it depends on your particular case/keyboard. I have used one made by New Trent with my iPad 4 and built into the keyboard section was a shelf that the iPad nestled into...the iPad itself rotates on the arm assembly that hold the iPad. Because of this, you could either set the iPad into this shelf in either portrait or landscape and the iPad would rotate accordingly. Here is one from New Trent for the iPad Air:

http://www.newtrent.com/store/ipad-case/arclight-2-0-nt510k.html

Note that you do need to set the screen orientation switch to unlocked for the auto-rotation to happen. See:

About the iPad Side Switch - Apple Support