I haven't read every post in here, so my succinct answers are probably going to be repeats of what somebody else said:
All these questions depend vastly on the type of MUD you're making. In the case of MUDs like Accursed Lands or Lament, where players can literally colonize wild frontier lands without any staff interaction, I think the code provides a way for them to both build settlements and keep documents on them in the form of books. It's a very organic, beautiful system. I would add any large settlements to a map maybe, or a short helpfiles but generally I think things are more meaningful when they are only a part of the game world, and not given life in OOC documentation. They're almost secrets.
However, in the vast majority of games, I've seen players absolutely decimate documentation and areas. There's no continuity, there's no quality control, and there's no standard. To quote John Malaney, they're like dogs without horses. It's horrible.