I've used the powder tests. Not for nitrates, though, but ammonia and iron. They work just the same. I compared results with my trusty liquid test, and it was basically identical. The only difference is that the powder is hard to dissolve, it takes quite a bit more shaking than with liquid reagants. I'd say ease of use is the only real difference.
I'm willing to bet that the liquid reagants are just pre-dissolved powder or crystal solutions, anyway. They've just made it a little more convenient for us