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I am looking at doing a small web application for learning purposes, using .NET. My conundrum is whether I should be exposing application logic to other sites and applications via a REST API, or a set of Web Services.

I am familiar with web services, but have not worked with REST. I understand the concepts of REST, I just have no practical experience with it.

Why would I use REST instead of web services for this scenario? Or not? What the issues that I should be mindful of when designing a REST API, particularly with .NET?

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Great; these did not pop up when I entered my question title. I shall check them out.
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.NET offers frameworks for both cases - Windows Communication Foundation for web services and ADO.NET Data Services for a REST API.

Both technologies are equaly powerful, but personaly I think a REST API is a smarter, cleaner solution. It ís somewhat more lightweight.

Further ADO.NET Data Services has the advantage that is very easy to get data from the database to the front end - even complete object graphs. A big win if you design a datacentric application.

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