Can't comment on the engineering side of things, but Liverpool as a city and as a uni is great (well I had a great time). Everyone is really friendly and has a good night life. University is located like a 5 minute walk from town.
Personally I didn't like Sheffield when I went to visit (was too gloomy IMO), but obv that's just my own personal opinion.
Ultimately the choice has to be yours. Perhaps look at what the course offers (like modules and stuff) and see which ones most appeal (that's what I did when I was deciding between Liverpool and Bham).
I would say consider everything about the uni, not just league tables (which can be a bit blergh anyway). Can you see yourself living there?