This may be completely ridiculous and off-base, but I sort of assume the white ones are considered "standard" size and are thus less likely to get lost in the mail. Okay, now that I've written it out it seems silly, probably doesn't matter at all. (When I applied last year, regular ones worked fine.)
The small white ones will cost less to mail, but if they need to do a several-page form the manila ones will be easier. (If they do need to do that, I'd suggest loading one up with a dummy form and weighing it, then pre-stamping it for them.)
The manila envelopes count as what the post office terms "flats", which have a slightly different postage rate (mostly because the envelope itself is so much heavier, but also because they basically get more manual handling). When I worked at the PO standard postage for one was $.71 as compared to $.38 (I think) for a standard envelope, but that was a while ago.
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