See, I always avoid calling it a "date". It totally gives my hand away if she isn't interested yet. Better to give her time to like me more.
I can definitely see the problem of trying to turn someone down before he's even made it clear that he likes you. If he doesn't - or chooses to act as if he doesn't when you turn him down - he could, to try and save face, easily call you arrogant for believing that everyone would be attracted to you, etc.
But if a guy actually likes a girl, and she doesn't like him, the end result will still be the same. The choice is between telling him and letting him know where he stands, or letting it drag out and try to hint that you don't like him, which can definitely waste his time - especially since it can be hard for inexperienced guys to tell that apart from a girl acting coy.
I'll say that "real men" will be able to accept being turned down graciously however, though in most cases they will also be able to understand the hinting as well. "Nice guys" might be more upset, but I'd think the majority of guys will still take a turndown without acting out.
It is actually better to turn guys down right away, but that is confrontational, which many girls don't want to be. Easier then to just try to let the whole issue run out in the sand. But being upfront about it really is the best way.
Now let me turn the whole question back at you:
How would you prefer to be turned down by a guy, and does the answer change if we're talking turning down early, or turning you down if you want a relationship after having dated/had sex with a guy?