Welcome to theRPGsite Tensen, I'll have to admit I haven't heard of it either, can you fill us in on a few more details from your experiences? Shared setting creation from my own perspective is fine in limited quantities, usually being most valuable during character creation.
I agree about Shared Setting creation being fine in limited quatities. Having actually used 'Dawn of Worlds" to make a game setting... and having the game fail for that reason.
Technoir is a Cyberpunk/Noir game that could, by some people, be considered a Story Game, though only in the GMs role really. There is a mechanic/system and characters have skills and stats and the whole Nine yards.
The Transmission is basically the setting. It is a large list of 36 "plot nodes" spread evenly between 6 Categories: Contacts, Events, Factions, Locations, Objects and Threats. At the beginning of the game the GM randomly picks Three of them and sees how they can be connected, this creates the main hook and as more plot nodes get pulled in the story gets bigger and more connected.
Since the GM can't really plan any story beforehand having the Transmission made prior to the game isn't really a requirement. So I thought, as a way to get the players more involved we would make the transmission at the table. Each player contributing one Plot Node in each category. This way they can have a say in what they'd like to see. But, the way the game works they wouldn't know HOW they're going to see it or even if they will at all.
I have made Transmissions before and they don't take that long so I think it may be a cool thing to do at the beginning of the first session. I can organize it during Character creation.