I know we do picks here at Bloody Elbow before each PPV show, but I'm going to tip the hand early: I'm picking BJ Penn.
The first reason I'm picking BJ is that I expect him to be standing or on top of Sherk for most of this fight. As Luke Thomas has pointed out, Matt Hughes had a much harder time getting BJ Penn down than he did getting Sean Sherk down. That is not dispositive of course, but the same can be said of Georges St. Pierre's experience against the two.
On his back, Sherk has shown that he is competent but not much more in the two fights where we've seen him in that position for an extended period of time. I do not expect BJ will have any more trouble mounting him and punishing him than he did Joe Stevenson. In fact, it may be easier for him once he's on top.
In a standing position, BJ is going to waste Sherk. Sherk's boxing technique is solid, and he has a strong chin with good head movement, but BJ's standup is very underrated, and I think his heavy hooks will just be way too much for Sherk to handle. Joe Stevenson looked like a complete joke standing against BJ, and I doubt Sherk will fare much better.
As many have postulated, Sherk's best hope is to tire out BJ in the first two rounds, survive the onslaught, and outwork BJ toward a decision. I just don't see this plan working. We are yet to see Sherk's cardio truly tested in the way it will be here. He took a bit of a beating against Hughes, but nothing like he's going to face against Penn. Simply holding on isn't an option against a fighter that is trying to finish every second of the fight. Nothing tests cardio like getting pounded in the face, bleeding, and having a guy try to submit you at every turn.
Unless Penn comes in unprepared, which I find highly unlikely, this is his fight.