Dw i is more traditional and makes more sense since it was originally "Rydw i", but dwi is what most young people use I would say. They are interchangeable.
not between "dwi" and "dw i", but the emphasis changes with "Rydw i" onto the "Ry" because of how Welsh words are emphasised and the "i" is more separate when it's "Rydw i" as opposed to how "dw i" is more one word (sounds like "dwee") which is why the "dwi" spelling now exists.