Happy or sad, I think isn't the proper question. In my opinion, the story's ending must resolve satisfactorily all the questions and problems that have been posed.
Right now, I'm struggling with the ending of my novel [i]The Bridge Beckons[/i]. Should I let the heroine live or die? I know, I told you it was ready to go to the publisher, assuming I can get one to buy it. But right now, I realize I need to readdress my final chapter.
If my heroine dies, it would be horrible, heart wrenching, but a realistic outcome of all that had gone on before. But would it solve the main problem, that of my hero overcoming his phobia? As one critiquer suggested, having her die on the bridge would likely make his phobia worse.
If she lives, however, I fear it could read too much like a cheap romance novel, all hearts and flowers, and would not be realistic. But it could have the effect of helping the hero to overcome his phobia, assuming I can write the ending well enough.
Either way, I don't think the question of whether happy versus sad endings is important, as long as it is satisfying. If the reader cries out buckets of tears over the ending, then I as a writer have succeeded in my main purpose, that being to entertain my readers.