Totally valid choice by you. But it's not binary. You can give your players cordoned off areas without impeding on your broad strokes much at all. Let them make their home town, name the blacksmith, etc.
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When I give them a section to build, I will ALWAYS give them a caveat. You can tell me about this person AS YOU KNOW IT. If they have a deep dark secret, your character wouldn't necessarily know, and that's always on the table for me to add to any NPC, player-created or not.
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