I love foam pads as they can be had in different levels of abrasives and you can control the level you want. Also you can get them dimpled to reduce heat. Heat is the prime factor in paint damage.
Foam pads today are much like Microfiber towels and just a much better and controlled product. They are also very easy to clean.
Wool pads are much like terry cloth towels. It will still do the job and there are still some jobs for them but if you are doing a high level finish polishing job you want to use foam. The degree of control and level of results are just so much better.