What are the reasons to choose one fibre over another - are there advantages and disadvantages for each type of fibre? If I have a pattern that specifies wool, is it usually safe to substitute for cotton, or vice versa?
Each type of fiber has unique characteristics that must be taken into account when considering substitution (which is pretty much a pattern-by-pattern process). Some examples:
Machine Washability Silk and pure wool arn't machine washable, cotton and most synthetics are, linen is actually improved by being machine washed.
Breathability All of the natural fibers (wool, silk, cotton, linen, etc.) breathe, but the synthetics (acrylic, polyester, etc.) don't.
"Stickiness" Certain techniques (drop stitches, felting) require the built-in self-gripping of wool and similar animal fibers. This also impacts things like cotton's known tendency to droop.
Elasticity This is the fiber's ability to stretch and contract, which affects an item's ability to regain its orignial shape as well as how wearing the yarn is to knit with (hand fatigue). Animal fibers and some synthetics are stretchy, while plant fibers aren't.
Allergies & Sensitivities Wool is the infamous one in both these categories, though synthetics can be problematic, too. Plant fibers do better.
In general, the closer you stick to the recommended fiber type, the more predictable the results will be (replacing cotton with wool is riskier than replacing it with linen). If you really want a specific substitution, you can try contacting the designer for their thoughts; also, if you're on something like Ravelry, you can see if anybody else has tried it.
"Can I substitute one yarn weight for another yarn weight?
No, each project is designed to be made with a specific weight of yarn. Changing the yarn weight will change the size and appearance of the finished project as well as change the amount of yarn required.
Can I substitute different yarn brands of the same yarn weight?
Yes, but be sure to test the “gauge” to make sure that an adjustment is not necessary as you substitute one yarn for another. See question # 8 to learn more about “gauge.”
As for some of the differences between various yarns this Wikipedia link shows some difference from the various types of yarn:
"All varieties of cotton have a dull finish unless mercerized. Cotton yarn has minimal elasticity unless blended with other fibers. Pure cotton is useful for projects that require structure such as purses and tote bags, placemats, and other utilitarian items.
Egyptian cotton Longest cotton fiber, smoother and softer than other cottons.
Pima cotton Cross between Egyptian and American cottons. Intermediate properties.
American cotton Medium-long fiber, readily takes on dye. Available in widest variety of colors.
Other plant fibers
Linen Strong fiber, good for warm weather items. Wrinkles easily.
Bamboo bast Similar to ramie, possesses an elegant sheen. Not to be confused with the more common bamboo rayon.
Animal based fibers
Merino wool Softer than cotton, tends to pill..
Icelandic wool Strong but scratchy.
Mohair Lofty and luxurious, best used as an outer layer. May feel scratchy.
Cashmere Soft, luxurious, expensive.
Alpaca Very warm. Suitable for accessories such as scarves.
Angora Very soft, tends to shed. Best used in pure form as an accent material, or blended with other fibers.
Silk Exceptionally strong, lustrous, and shiny. Good for summer wear.
Acrylic Washes well, inexpensive. Good choice for beginners and for items designed for babies or pets.
Nylon Strong, elastic, washes well. Not ideal for garments unless blended with other fibers.
Rayon Made from processed cellulose (e.g. wood pulp, bamboo, seaweed) extruded into threads. Inexpensive and highly absorbent, natural sheen."