I suppose one way of looking at what scale we build is actually what is available for us? For those who wish to build kits and stuff like that. I dont think many manufacturers produce many varying scales of one particular vessel - I know there are a variety of scales in lifeboats and tugs and so forth but, as we move on to the larger vessels, as in warships and liners, cargo ships etc., the amount of scales/choice & fittings seems to diminish.
So, in a way that is where a scratchbuilder has a slight advantage over the readily available 'kits'.
The only drawback is, if you build an odd scale the chances are you would have to manufacture all of your fittings.
To go to shed a bit of light on what Bryan was saying about how much detail to put on a model to make it a 'workable glass case model' depends on the model one builds - have a look at some of the lifeboat models which have been made - the standard of workmanship/fittings are of the highest standard possible and yet some of these are working models and not just for the glass case.
As far as ME and MY SCALES

I would love to build a 1:48 scale warship but :-
a) me work bench is only 80 inches long
b) weight & who can carry it to the Lake

c) I would end up getting wrong from the Mrs - mmmmmm where could I store it
aye
john e
bluebird