It depends on several factors, the most important of which is probably the company that's behind the publication. If they plan on selling the book in any form, then you really should be paid for your work. They're profiting from it, so there's no reason why you shouldn't. At the level of contribution we're talking about here (one or a small number of monsters or prestige classes) you're not going to get much name recognition or a reputation out of it. Your name is likely to be one of many.
If you're asked to write anything more than 1000 words, you should be paid. There are enough paying outlets in the market that there's no reason to not take the same material that you'd do for free and submit (or propose) it to Dragon, Dungeon, Polyhedron, d20 Weekly, or Campaign. Those magazines all pay reasonable rates, plus you'll have your name attached directly to the article rather than stuck in a block with lots of other names. Best of all, if you do good work you can establish a relationship with the editorial staff. For instance, with Dragon I started off with one comissioned article, did a good job on it, and have done about 10 more since then. There's no better feeling than establishing a steady working relationship with a company.
As far as money up front goes: unproven companies asking you to write more than a week's worth of work or 8,000 words (whichever is less) should pay you half up front. If the company has published a half dozen or more products in the past year, keeps their website up to date, and stays reasonably on time with their releases, you can probably trust them to pay you. Otherwise, ask for half your money up front. If they can't afford to pay you at the start, they probably can't ever afford to pay you.
This is probably the most important lesson I can offer a would-be writer: hold out until you find a job you want to do at terms you are happy with. If you have talent and dedication, it's only a matter of time before you find a situation you're happy with.
It is NOT an honor to be published. It's a job. Hit your deadlines, familiarize yourself with the system and its writing conventions (ie, italicize spells, capitalize feats and skills, and so on), and happily make editorial changes that are asked of you. By the same token, companies should treat you as a business partner. They should be courteous, respectful, friendly, and obey their contracts to the best of their ability.
Remember: if they charge money for your work, someone is making a profit off of it.