I agree totally with separating the rules tidbits from the world and myth information, but I do see one minor issue.
Of the three information types, one is universal (the game rule information) since it is the game "definition" of the monster, but the other two (mythological fit and world role and lifestyle) are world-specific.
Now, a Monster Manual needs the first, and could include the latter two for some assumed "default" world, while a setting book ought to have the latter two and could have the rules definition stuff as well for convenience. But I'll bet pennies to bricks of gold that there will be moans with any variant of this about "forcing me to buy the same stuff twice" or "making me buy this "default world" garbage that I won't use"...
I think it's even worse than that, isn't it?
Isn't some sort of "mythic history" inherent to some monsters? Devils and demons most obviously, but perhaps also mind flayers and aboleths. And surely efreeti, by default, come from the City of Brass!
Whereas for others - say, spiders (who have a mythic connection to Lolth in 4e, but can easily be separated from that yet still be fully realised as spiders), or doppelgangers (who in 4e have what I would regard as an even more optional connection to Avandra) - the monster can exist and fully play its game role without any particular mythic history.
There are also some monsters whose "ecology" is inherent to their being - vampires, and probably ghouls, might be the best examples, but there are probably others I'm forgetting. (Otyughs? Maybe xorns too, whose only rationale seems to be to threaten to eat the PCs' gems.) Whereas for elementals, or ankhegs, or giant scorpions, ecology seems pretty optional.
But wherever WotC makes the call on which monsters fall into which of these categories, someone will be upset because they took a different view on whether or not myth or ecology was or was not inherent to some particular monster.
I'm of the position that master heading silos and evocative keywords best handle these issues. Less, but the kind of less that informs (but doesn't saturate with canon) while simultaneously provoking, is more.
Consider the Dungeon World route. You have:
1) Monster Settings that silo creatures into a specific habitat, locale, etc. If a creature is under the subheading of "The Dark Woods" you get a provocative blurb that talks about what horrors and mysteries lurk in the deepest recesses of an ancient wood, about the blood-curdling scream of a wolf-man's howl, and a warning to travelers to hurry along the well-worn trails/do not stray and to keep your fires scant and your torches dim so as to not invite attention. Scary things lurk here. Contrast this with the blurb for "Twisted Experiments" and you have a very different sense of the abominations therein, their origin, and deranged sentience. You can certainly have a setting book and a monster manual which leverages this silo to advantage.
2) A singular Instinct such as "To feed", "To rule", "To pass on divine vengeance", "To perfect its concept", or "To multiply". If there is one guiding premise for these creatures' behavioral regime, this is it. These inform and provoke without restricting or saturating. There is guidance but room to create.
3) Tags such as "Horde", "Organized", "Intelligent", "Solitary", "Terrifying", "Magical", "Divine". These speak to how these creatures organize and their intrinsic nature. The deftness of these keywords allow for all manner of in-situ customization by being simultaneously informative and wieldy (minimal mental overhead).
4) Moves such as "Grant power for a price", "Charge (!)", "Extort", "Use the dark to advantage", "Inflict pain beyond measure", or "Hurl something or someone." These give the GM specific thematic ways to exert pressure upon PCs both in combat and out. They guide while not restricting and have minimal table handling time in their deployment (and minimal overhead required to internalize the concept).
Then of course you have a small, few sentence blurb which typically conveys a short story (perhaps an old man in an inn warning travelers) and the mechanical stat block (et al) which will synergize with the above themes and concepts. Each of these individual, bite-size entries are mechanically and thematically weighty and allow for the manual to churn out 2 (perhaps even 3) monsters per (small) page.
I think both a specific Setting Book and Monster Manual could make use of this formatting. A Setting Book with acute distinctions from the general Monster Manual would primarily just have different Monster Settings which would silo the creatures away from the generic manual and silo them away from each other in the Setting Book.
However, again, it should be noted that it appears a certain cross-section of people are interested in D&D books as means of actual fiction. They want 1-2 pages of extensive (exhaustive?) ecology, organization, spectrum of species behavior, etc information on each creature. Presumably this is because the experience of reading the book itself, ingesting the vast swath of canon (and thus having that RPG notch on your belt for potential future use), and deeply ruminating on world-building (pre-game) is the primary point of purchase/ownership. For myself, the primary point of ownership is agile table functionality (meaning informative and provocative - thematically hefty - but not restrictive or overwhelming use at at the table + minimal table handling time). As @
pemerton notes, you cannot make a layout that pleases both of us. The interests of utility and aesthetic are mutually exclusive.
