DMZ2112
Chaotic Looseleaf
Oh, I don't know. I think it depends on the particular metaphysics of your campaign world. If monsters are exuded from the deeper darkness below (more manifestations than species) and, rather than merely being extensions of the surface world, dungeons are the spaces below the fields men know where the deeper you go the more strange and perilous things become, then the conceit works quite well.
This is one of my (unreasonable) complaints about 13th Age -- the 13th Age setting does this sort of thing, and it is so... conceptual, that I can't picture myself ever running a "serious" campaign there. It's just one of my personal hang ups -- I can't have wizards pulling orcs fully grown from the mud, I need there to be female orcs and baby orcs and orc food and orc privies because that is how living things do.
That said, I do love the humor of the writing. The bit about the tarrasque getting stepped on by the Koru behemoth is just gold.