I generally leave mine open while I'm in the add-wood stage so that the smoke continues to move and doesn't get stagnant. If you have it shut all the way, the excess will go out by the gaskets which is fine, but will eventually build up some "goo" there.
I use the water pan all the time too (except for stuff like jerky which I'm trying to dry out) as that helps keep the heat more constant if nothing else. Having the vent open a bit will let some of the steam escape too. Especially in cold weather, the steam can look quite a bit like smoke so give it a sniff (from downwind a bit so you don't cook your nose hairs!) to see if you need to add more wood.
Generally, I will keep the vent closed while preheating or just cracked, and then when putting in the meat and wood, will open the vent just enough to keep the smoke from going out the gaskets. Many people open the vent all the way and if I have a ton of smoke going I will too. If it's windy, the smaller opening seems to keep my MES smoking longer and it also seems to keep the temps from dropping as fast but I haven't really validated that yet. It makes sense to me, but maybe it's just that I'm hoping it lasts longer since right now it's cold outside.