If you want search engine traffic, you must use text links. Many people prefer graphical menus or javascript fly-out menus. Unless you have a billion-dollar budget, however, it makes more sense to use text links.

For a great example, search for "dvd players" in Google, and then analyze the top 3 results. (Cnet.com, Bizrate.com and Shopping.com). If you drill down to their pages and analyze the incoming menu links to get to the page, you'll see that all of the links are plain text.