I definitely agree on the "not all are deserving" part of your comment... So I tend to prefer the British tipping system, as I only tip those who I think did a good job and do deserve it..and when this is the case, I generally round up to the nearest whole amount, as others have said. But when in doubt, i just ask my bf.
As for in bars/pubs, when I worked in Manchester, people would say "and one for yourself", so I just took whatever spare coins there were after counting out the customer's change, because i didnt really feel comfortable with it/want to come off as being greedy, though I could've probably taken more, as the cheapest pint there cost about 3 quid. I never expected much, but I did end up making anywhere between 1-15 pounds a night if I was tending bar. If I was waiting tables, I made considerably more than that, since it was a bit more posh than any of the other places around, and people generally left around 10%.
I've gotten my hair done at the teaching salons (Wella Studio in Manchester/Aveda Institute in London), where it costs about a tenner, and I generally left an additional pound or two--whatever i had in my wallet, since i thought they deserved it. But when I had my hair done in Nottingham, I didn't tip; the lady seemed to expect something extra (maybe because she knows Americans tip for everything), but she certainly did not deserve an extra penny. Worst experience/haircut EVER!