I guess it's just a matter of how you prefer to say it. I use a lot of "hundreds" for no logical reason. But, anyone can get confused... :)

I never understood that myself. I always say one thousand two hundred. The easiest one must be American :D (hi Tim!)

Its simply quicker, that's all. :)

One thousand two hundred is the formal way of writing and saying. Twelve hundred is more slangy. However both can be used. Also when we say, one thousand twelve hundred times, it seems that the count is greater than just saying twelve hundred. Today I just picked up an envelope containing one thousand and two hundred dollars just to emphasize the amount. Twelve hundred sounds so little even though the amount is exactly the same. Most probably the word, "thousand" is more than "hundred".

It's a case of "either-or", not "instead". I suppose sometimes "one thousand, two hundred" is more of a mouthful than "twelve hundred". Or, maybe it's a habit which drifted over from how we say years.