When I was younger I used to run pretty much every campaign this way. Just see what happens and roll with it. As such, I was very good (
IMHO) at handling things on the fly and keeping it interesting.
As I've gotten older, it's been a bid difficult to do, but after running an adventure path and a heap of pre-written adventures, I've got a hankering for a sandbox style campaign. As such, it's what I'm prepping for right now as my next campaign.
I took most of my inspiration and ideas from the Grand Experiments: West Marches articles over on Ars Ludi (
part 1,
part 2,
part 3,
part 4, and
running your own) and have been fleshing out a wilderness area of Eberron for my players to romp around in. I've been doing my best to create one interesting item a day: NPCs, locations, quests, macguffins, etc. Nothing is extremely fleshed out, but I hope that when the campaign starts I'll have enough elements floating around that players can latch onto and interesting play will emerge from that. Over my years of DMing, emergent play seems to be the most rewarding.
Thanks for the interesting non-edition-flamewar-topic! Also, I highly recommend checking out the articles I've linked above, if you've never read them before.