Sharing the creative burden with the players has the same problem as the pure sandbox: without plot hooks the PCs could end up exploring the dull parts of town. However, I do use this when the plot overlaps an area from the PC's background. I don't want to stomp all over the PC's backstory by setting up his father as the evil overlord when the player wanted a nice father, or vice versa. But this is best worked out with the player in email outside of gaming time. That makes it a surprise for the other players, but lets me plan ahead.
Nevertheless, I don't see how sharing the creative burden works with a railroad plot. Giving players more choices, choices about not just their character but also the setting, would lead to more derailments.
Agreed, sharing the creative burden does NOT work with a canned plot. I mostly suggest it as a way of reducing GM prep work. A common complaint of why people say they don't GM, or say that railroading is necessary, is because of the prep work involved. Sharing that creative burden is one way to reduce (sometimes even eliminate) GM prep work needed to play the game.
On the flip side, if the players are truly interested in what the GM has prepped and the GM enjoys doing that prep, that can make for an awesome game.
I run both prep heavy games and zero prep games. I really do see the value in both, though in my high prep games, I still don't railroad and let the players go where their actions take them instead of wherever I thought it was going to go.