Since I am a player right now I'll answer from that side of the screen. As a player nothing would be more boring for me to know that all the encounters were balanced for my/party's level. I like that challenge of figuring out way to get around or trick tougher opponents or be tricked into thinking "oh, these guys will be cake" and charge. Then find my ass on a silver platter.
If you've played for any length of time, when the GM says its this monster you can dial up the page of the Monster Manual in your head and have a good idea of its HD, AC ect. So the players can assess fairly quickly if they plan on chopping away or sneaking away. But I love the challenges where I know I am way outnumbered or out powered and finding away to defeat that foe. One of the simplest examples I can think of is there is a bridge over a wide creek. But there is a troll guarding the bridge. If you can guess at his riddle then you may pass unharmed. Wrong answer and he eats your head. Why not just cross the creek the bridge spans? Because there is a small army of orcs and ogres that aren't in the mood to talk and will just shoot things at you until you are chum.
As a GM it depends on the group I'm running. If I have a newbie group like I was running earlier in the year I would run balance, but challenging encounters. I want them to learn the game and adjust to the threat levels of different monsters. I may put a big bad monster over yonder and if they stray to close I may have it scorch someone to show death is a very real possibility in the game and I'm not afraid to use it.
Old time gamers, I don't worry about game balance one bit. I throw in critters I think make sense for the adventure. If could be they only get half way through and encounter something they have no chance of defeating, but then return when they are a little stronger and take it on again. Plus the old dudes I play with are very good at circumventing/manipulating/influencing a bad situation in their favor. I think they would get very bored if I level the playing field.
So whatta ya think? Go game balance or no game balance? That is the Friday question of the week.
Other blogs the are talking about this same subject:
Beedo of Dreams of the Lich House
And Mr. 2000cp himself, Erik of Tenkar's Tavern