Personally, hard drive space isn't an issue, so I generally am not concerned with how much space my recordings are taking up, but I can understand how this could be an issue for some.
I think it mostly comes down to trying to encode as few times as possible. While the quality doesn't go down a crazy amount when re-encoding it is still noticeable and generally something editors try to avoid, especially considering that youtube does its own encoding. Editors for RJWeekly generally don't encode until the very end simply because it's how to make videos look good without uploading raw AVIs.
Also, some people (all RJWeekly editors) use some form of frameblending where you're either left dealing with raw TGAs, PNGs, or an AVI, so you wouldn't even be able to encode at that stage even if you wanted to. There's been a tool released (
https://github.com/AronParker/AviRecorder) that could theoretically encode straight to mp4, but if you're going through all this effort anyway there's not really good reason to sacrifice quality for file size.
Basically just comes down to whether you're willing to be dealing with massive files in order to get a better (albeit only slightly) result.