Still, there's one section in the core rules that I feel makes a very important statement about DM design and strict adherence to some esoteric idea about rules canon:
Monsters are not player characters, and their abilities are not at all determined by the rules for player characters — not even the stats for races that can have player
characters, such as Dwarves. The Referee decides a monster’s abilities, and he doesn’t have to follow any rules about this! Feel free to add wings, breath weapons,
extra hit dice, wounded versions, or whatever suits your adventure and your campaign. Toggle and tweak, imagine and invent! The rules aren’t responsible for the quality of the swords and sorcery in your game, you are! So don’t try to create monsters according to any sort of power formula. Create monsters based on how they feel and how they play at the gaming table. Create challenges for the players, not headaches for yourself. Your job is to imagine and create, not to slave at rulebooks finding out what you’re “allowed” to do.
While author Matthew Finch is, obviously, talking specifically about custom monster design, I think this reasoning can apply to any DM design task; magic items, spells, etc.
As the highlighted part of the citation reminds us, you are the game master, and once your campaign gets going, noone knows it better than you and your players, not even the most skilled of game designers. Feel free to tweak, ignore or add things to the rules wherever it suits your game.
S&W is a quality clone game, very nicely organized and presented, and it and its supplemental material are definitely worth checking out for inclusion in any old school game.