Is there a preferred finish for sports flooring? Is Traffic appropriate here?

Most gyms are re-coated often and nearly all choose a high gloss finish. Traffic is not classified as a gym finish because:

1) it is very expensive and not available in 5 gallon pails
2) does not come in high gloss

A quality oil-modified urethane in high gloss has been the industry standard for many years. It is economical and fairly durable. However, it is slow curing and usually high in VOC's. That may not fit the customer's schedule or region. Many water-based finish manufacturers have economical water-based gym finishes that are available in 5 gallon pails to help reduce cost. Since many gyms are re-coated often, there is no need to use the most expensive in hopes of reducing the re-coating schedule. Gym re-coats for very active gym floors are usually annually. Less used floors of course need a schedule suited for the use of the floor. Now, a small sports court, like a squash court or handball court, could use Traffic as one could use a semi-gloss finish and since it's smaller in size, the cost is not nearly as prohibitive. So, small sports court could use Traffic but it is typically NOT recommended for full size basketball courts.

What would you use for a dance floor?

If it is a hardwood floor, any quality commercial grade hardwood floor finish containing polyurethane will work. If the dancers are wearing taps or are clogging, the finish will wear quickly. Ballet slippers obviously will not harm the finish as much. Plan on regular re-coating of the floors.