I prefer Gothic 1 overall but G2 is excellent as well. I think the setting of G1 is really unique and executed very well, giving a strong sense of being in an actual prison colony with nothing but the rags on your back, building yourself up slowly in this rough place where it is difficult to survive and resources are scarce, etc. G2 has that as well, using a clever trick to "reset" your character when you start the game, but G1 has a stronger sense of that to me.
Still both really great RPGs and unique in every way. I'd suggest starting with the first game for anyone who wants to play the series for the first time, but I suggest that for every RPG series that features sequels that include the same characters, etc..