I don't think there's a real downside to editing the mnu, aside from the small aggravations and extra steps you mention, which tend to support my view that it's a bit simpler and a bit safer to deal directly with the mns. I do copy my current mns to mnu as a backup, but that's just in the read-only place where I fool with it. I distribute only the mns file (and associated images) to users. They don't have an mnu at all, so they can't mess anything up by ignoring a warning.
For customizing toolbars, I sometimes "mock up" a button interactively, but then go back and hand-edit the resultant mns to make sure the image reference is correct. And then I'm done, having no reason to cut and paste anything elsewhere.
The docs say comments are lost from mnu to mns, as Robert mentions, but that is only true if you edit the mnu -- Acad strips out comments when it creates the mns. But if you place them in the mns yourself, they stay there. This is one small benefit of skipping the mnu format.
As you say, to each his own, this has been beaten to death before, and caused no end of confusion for people trying to learn menu customization. IMHO, if Acad had eliminated the mnu format back when they essentially made it obsolete, this wouldn't be an issue, but apparently they thought it was one of those "compatibility" things that needed to linger on, like (vmon).
Tom Smith said:
It's simpler and safer, IMHO, to just edit the mns, which is the file that is actually in use by Acad as the source for the current compiled menu.
To each his own I suppose, but I *only* edit the MNU file. No, I never make any menu/toolbar changes through the graphical interface. If a person edits the MNS, and then either himself or someone else comes along and reloads the MNU... [Note: Yes, I know about the warning - and have watched people do this - about 7 out of 10 don't read it, they just press Yes, and 2 more out of 10 read it, but don't understand what it means - then press Yes]
....anyway, as soon as the MNU is loaded - bye-bye MNS, MNC, MNR....
I can't see any downside to only editing the MNU, other than it takes slightly longer to load. Of course if you like fooling with the graphical toolbar interface, then of course you would have to cut/paste from the MNS into the MNU before reloading....