LlamaMama, super-great question and interesting answers!
I think I'm usually about "mid-distance" camera-wise. I can click any controllable Sim (and my households usually have at least 2 Sims in them), and get a good idea of "what's in the room, what's going on." I can see onto neighboring lots, and usually hear next-door-neighbor's kids crying, if that helps. I've very, very rarely "zoomed way out" or in the "town view" unless I'm sending a Sim to a different lot.
I keep walls at the mid-position ... if something's looking "picture-worthy" I'll pause or "slow" the game to 1 (normal speed, I think it's called) and raise the walls so I can get a decent picture (I miss the Sims2 robust camera controls, I'm still not sold on the whole "video camera" default settings of the Sims3).
I just about ALWAYS keep the speed on 2 (Fast), unless I'm watching a Sim closely or checking out an animation / new object / a new Expansion pack's out and I want to see what's going on. Speed 3 (Ultra) is only for bedtime / skilling up.
So it's "Queue stuff up" ... "press PLAY (at speed 2)" ... watch for a bit ... then "Pause." Rinse and Repeat.
Great question. I think just about everyone's play style's different, it's insightful to see how others play.

-- Happytime