I for one don't consider it odd to create on the fly. In some cases, it's a necessity, particularly if the players aren't forbidden from venturing "off the game board". In my current campaign, I had designed an ancestral keep which the characters would need to explore. In the deepest undercellar I put a fault line on the floor that plunged down into a 320' deep chasm. I didn't flesh it out because I thought, "No way are they going to be so insane as to deviate from their pressing task just to check out some stupid deep fissure!" So I just made a notation that a "bunch of grimlocks" dwelled down at the bottom, and left it at that. Didn't even write up their stats.
Sure enough...guess where they went?
Some people think SOP stands for Standard Operational Procedure. When I'm running D&D, it stands for Seat Of Pants. In my humble opinion, any DM who says that the players' characters can "go anywhere and do anything", had darn well better be able to create on the fly.