2 Alternatives for getting an Observable from a Stream

NewVersion.cs

	IObservable<string> ObserveStringStream(Stream inputStream)
	{
		var streamReader = new StreamReader(inputStream);
		return ReadLoop(streamReader).ToObservable(Scheduler.ThreadPool);
	}

	private IEnumerable<string> ReadLoop(StreamReader reader)
	{
		while (true)
		{
			var line = reader.ReadLine();
			if (line != null)
			{
				yield return line;
			}
			else
			{
				yield break;
			}
		}
	}

OldVersion.cs

	IObservable<string> ObserveStringStream(Stream inputStream)
	{
		var streamReader = new StreamReader(inputStream);
		return Observable.Create<string>(observer => Scheduler.ThreadPool.Schedule(() => ReadLoop(streamReader, observer)));
	}

	private void ReadLoop(StreamReader reader, IObserver<string> observer)
	{
		while (true)
		{
			try
			{
				var line = reader.ReadLine();
				if (line != null)
				{
					observer.OnNext(line);
				}
				else
				{
					observer.OnCompleted();
					break;
				}
			}
			catch (Exception ex)
			{
				observer.OnError(ex);
				break;
			}
		}
	}

Two version of generating a string observable from a stream. The old version has been in prod for ages and works well, the new version has only been played with a little in linqpad. Any reason to prefer the old version to the new? Any reason to prefer the new to the old, apart from being cleaner?