several things:

1. seeing what the stitches actually look like stitched out
2. allows you to see what the stitches look like when they are modified using length and width adjustments
3. seeing what the stitches look like when they are stitched our using different kinds of fabric and thread

I find that for me it's easier to decide exactly what stitch I want to use when I see it stitched out rather than looking at the printed diagram. Also, by changing the length and width you sometimes get stitches that look entirely different- so for someone who likes to play with different stitches as design elements, it adds to the number of stitches that are available on the machine.

Rob

My handbooks that came with my machine shows the stitches, and the newer machines lets you see the stitches on screen. I'm sure a lot of people use a variety of stitches, but I find I have my favorites and use them a lot.

Well forevermore. Another thing to spend time on that could be either a handy tool or another thing to store. I've never heard of a stitch book but can see the usefulness of seeing all those stitches in all their varieties. However, I always test out length and width when deciding even on a zigzag stitch before using it at the time of sewing. I can see myself spending a lot of time sewing up samples of stitches I would never use.
But, I do like this idea......

I am other one who has always done up a stitch book of my machines. It is handy when you can see the real deal instead of an image on the machine. But I started this way back when my bernina record only had it printed onto the top of the machine, and you had to move a lever to engage the designs. But, I am also the type of person who reads the guide from front to back when I get a machine.

I did mine on parchment coloured solid cotton such that it all looked like an old fashioned sampler, and hung it on the sewing room wall.

yes
and add to this
I like to combine some deco stitches...a stitch book allows me to remember what I did, and what I liked...or not.
combining stitches means lots more variety available for my poor brain to try to handle.
I keep adding new combos to the book

I also have the Bernina Record with 20 automated stitches. 40 years ago when it was new, I just made a quick guide of the stitches in 3 different widths. Still use it today.
Since I use serpentine stitching a lot, I made another quick guide recently with the different stitch lengths and widths.

I used a photo album for 4x6 pictures. Album fits under my extension table and adds support.

Stitches
 

I use Black Kona Cotton, so the stitches show up better.
Use. Interfacing on the back, the stitch out aboout three inches of each design with the associated number stitched at the top of each pattern.
Great reference tool.

I have made one for every machine, I generally do the stitches twice as well as all combinations of width and length - one on regular fabric (or muslin) and the other on a quilt sandwich. The first one is all the stitches and the second is of stitches that I think I could use a fun quilting stitch. Like others have said, it's a great reference.