In the UK...... BOTH!
VFR separated from IFR in Class C & D, but NOT separated from other VFR traffic.
From CAA web site:
Class C
IFR and VFR flights are permitted
All flights are provided with air traffic control service
IFR flights are separated from other IFR flights and from VFR flights.
VFR flights are separated from IFR flights and receive traffic information in respect of other VFR flights.
Class D
IFR and VFR flights are permitted
All flights are provided with air traffic control service
IFR flights are separated from other IFR flights and receive traffic information in respect of VFR flights
VFR flights receive traffic information in respect of all other flights.