This question is aimed primarily at the freelancers since the real world has provided the prototype modelers with their history. In my own case, I have written a short history of my own New York, Binghamton, and Western RR but it is really more of an outline rather than a detailed history. It covers the history of the road not just up to the mid 1950s when I am modeling it but also the later years when it was aborbed first by the NYC, then into the PC and Conrail years. I haven’t added a chapter since Conrail was divided up by CSX and NS, although I intend to do that. I haven’t even figured out which of those two giants would have ended up with that piece of Conrail.
Eventually, I would like to go back and fill in the blanks with much greater detail, including signifcant dates and events and their effect on my railroad, such as the Great Depression, WWI and WWII. Will such a history enhance operations. I doubt it but I believe it will create the feeling that my railroad really did exist which is something I think most freelancers aim for when they create their fantasy railroads.