Imagine if someone who didn't know what they were looking at found and perused one in a book store. Taken out of context, the MM has got to seem so utterly mad, that the reader might as well have stumbled on the Necronomicon. In both cases, it is not immediately clear whether the thing is a work of the imagination or of madness. And there would be a niggling feeling that there might be some truth in the work; something actually worth being afraid of.
But for us initiated ones, the MM is simply a game reference. And the Necronomicon is a just plot device for invoking Lovecraftishness.
As with most game-books, the index is practically useless.
Monster Manuals and the analogous books from other systems are seemingly indispensable to playing RPGs. If I could have the players handbook and one other book, I would choose the MM over the Dungeon Master's guide. Yet for all its utility, there is some baggage that comes with making a compendium of monsters one of the three pillars of your core ruleset.
The practical effect this has is to standardize fantastic creatures. This goes back to my whole deal about how "standard" fantasy is an oxymoron and Imagination Should Be Free and I get out the torches and the crowbars and go to town and all that.
Without much exaggeration, the Monster Manual might as well be called "Get Genre-Savvy Fast!"
I'm sure the Game Masters out there have experienced how this works: Breathlessly describing a terrifying monster only to have a player say, nonplussed "I know what it is."
As a DM, you hear this and you die a little on the inside.
Another odd bit worth mentioning is that some of the monsters are copyrighted! While a lot of the content is based on traditional mythological and folkloric material, Some monsters are just D&D monsters, copyrighted and considered part of WotC's "producr identity." This includes the Drow, beholders, carrion crawlers and a few others, so if you want to use them in your original work, you had better call them something else.
It's one of Lo Pan's "Guardians"
When you have a core book acting as one huge spoiler, the burden falls on the DM to use monsters in creative ways or "re-skin" them as something unfamiliar.
What might be cool is to have guidelines for developing monsters based on type or function. James Raggi IV sees the way to this in his Lamentations rules, but only mentions a handful of categories to work from (Ooze is a very broad category in LotFP.) And while this sort of vast deconstruction is the sort of thing that appeals to me, I will leave it alone for now, and focus on keeping monsters fresh.
Make the world less savvy than the players;
In this way, you turn genre-savviness on its head.
I had some players who were investigating a series of disappearances in the City-State of Markk
They were interviewing a local girl who had witnessed her sister being carried out a window by a "demon." they eventually got that the creature was like an ugly, emaciated little man with sharp teeth and bat-like wings. I explained that "demon" was the most precise word that a simple girl could muster up for such a thing.
So it could have been an imp or a mephit or maybe a homunculus. Most actual "Demons" in the Monster manual don't really fit the description. It was really a Berbalang, because I love the Fiend Folio. And the players were left in a respectable state of suspense as a result.
A "demon." Or perhaps a "vampire?"
My point is that just because the book makes a clear distinction, doesn't mean your world or the people therein will make the same distinction.
I say most non-adventurer characters in a gameworld will not make make clear or very perceptive distinctions. They might be limited to descriptions such as beast, angel (pretty wings), demon (bat wings), fairy (diminuitive-pleasant looking), goblin (diminuitive-ugly) , vampire (creeps on you in your room), ghosts (transparent dead person), wight/zombie (opaque dead person), oozes. serpents. And that would about cover the possibilities. These descriptions are based largely on the basic appearance of the monster, and leave a lot unsaid. The PCs will not be able to be sure what they are dealing with from simple hearsay.
Anyways, That's it. Just a trick for keeping monsters weird and creepy:
Basically, don't allow meta-knowledge from the MM or other books to spoil the suspense..