Really though, if the GM wants to keep the pcs from doing something he hasn't prepped, he only has to stall them for (part of) one session. I mean, you're already playing the session so some of it has gone by, and once the session is over you have until next session to prep whatever you need to. Throwing up an impassable mountain range or a quarantined plague zone is a major campaign addition, its something that's going affect all their future actions (and it presumes that the GM hasn't already laid out the general terrain). It seems like having an impassable mountain range (or whatever) show up when you need it and then never be a factor again would be a bigger hit to verisimilitude than simply saying, "I haven't prepped that," or running a smaller encounter to eat up the rest of the session.
Its hard to keep the Illusion of Liberty while forcing your players to do stuff. Personally, I'm not wild about the terms "illusion" and "keeping the players on a leash". Letting people do what they want to do is usually a pretty big part of why we play role-playing games instead of computer games, because we are limited only by our imaginations. (Granted, this is a bigger limitation on some days than it is on others.)
However, total freedom is somewhat illusory. In a game of a certain level, encounters require prep to be mechanically satisfying. That's my opinion, anyway. I'm not capable of reliably pulling layered, complex and balanced encounters out on a moment's notice. I generally like to do the math beforehand.
The trick is, for me anyway, to not let this limitation get in the way of the player's freedom. The players give me some idea where they are going with their characters, and I try to prep that in addition to the stuff that interests me. Sometimes the players are very specific in what they want to do ("We're taking out the church of Nerull in Barnascus.") and sometimes they're vague ("We want action and loot.")
I don't particularly like just saying "No" though, if the pcs want to wander off the beaten track I have in mind. There's a lot of reasons, but the two that stick out for me are that its important for the players to have that freedom of deciding what their characters do (and have that decision be meaningful), and going in unexpected directions is good for the game, it makes the GM be more creative and its one of the main ways the game is a collaborative endeavor and not me telling my friends a story.
So, if the pc's want to do something I'm not ready for and I don't want to break the verisimilitude by saying, "Not prepped," I'm much more likely to improv what I can and throw in a few encounters (prepped or wandering monster-style) to eat up the session so I can prep what I need to by next session.