Let me start with two assumptions in answering your question.
The party has 5 characters and they are 3rd level each. I am doing this deliberately to help you focus on the mechanics of the system and then take those mechanics back to your group.
Standard XP rewards are basically setup to work on an 8-10 encounter basis. This means that within 8-10 encounters a typical party of 5 characters will go up 1 level. The treasure parcel system is a way to parallel this. Remember that encounters are NOT the number of rooms/areas explored or passed through they are the number of fights, traps, skill challenges or other events that require characters to worry about their health.
DMG 1 Page 126:
During the course of gaining that level, expect a group of five characters to acquire four magic items ranging in level from one to four levels above the party level. In addition, they should find gold and other monetary treasure equal to the market price of two magic items of their level.
A 3rd level party would receive 4 magic items (levels 4, 5, 6, 7) and about 1350gp in monetary items. Looking at the parcel system as shown on page 126 of the DMG1 you will see this laid out in exactly that fashion. 10 parcels nice and neat. There is a guide on page 125 for adding or removing gp value and magic items based on actual party size. The PHB1 on page 223 has nice table of the gp vaule of magic item by level.
Now here is the trick. While this is a good guide of what to give out it is not a hard-set-in-stone law. You can combine, rearrange, add to or delete from this guide list to adjust for what makes sense for your campaign. You can give out 1 parcel per room or all at once or anything in between. Do what makes sense. Fighting 8 rooms of humanoids and 1 room with a dragon and all the treasure is in the dragons lair might just make sense.
As for how to pick magic item for characters I use three methods that overlap.
Special items I want in the campaign. This might be unique items I have created or special cool things I think that a character would use that they do not know about. (Not everyone has all the books, magazines and supplements - except me of course).
Character wish lists. Every player is required to give me a list of 10 items that they would like to see in their characters possession. It must contain magic items for each level starting at 1 level higher than their current and going to 5 levels higher. Limit 10 items on the list. They do this as part of leveling up. They have to include source and page number too.
Player pick. About once every 2 levels or so I let the player pick a magic item instead of having a specific item in a parcel. That item is only 2-3 levels higher than their current character level. This allows the player to 'customize' a magic item selection to fit their goals, skills or feats that they have chosen, and takes the pressure off of me for that area.
I have found that using the parcel list a basis and then tweaking it to fit the campaign really simplifies my game prep time. Using the 3 methods of magic item selection has given the party good balanced selection items that they can use and like to use.
NOTE: Be sure to rotate the highest level items in your parcels to be given out equally among the party characters.
Think about the real world
There are many conflicts in the real world, for many reasons. Look at news or a history book if you need inspiration. Not all of them are combat encounters, many might be detective work and exploration.
- Which church is allowed to tax/get the tenth in a village? Help the priests of Pelor against an attack by Asmodeus' children (insert $LOCAL_DEITY).
- Are there racial tensions between the races? Calm the mob of elves wanting to burn all halflings.
- Who illegally hunted a deer in the baron's forest? Free the arrested farmer or help prove his innocence so he won't be executed for his crime.
- A landslide destroyed the crop in the neighboring village, and they are running out of food. But giving them food from this village might lead to starvation in winter.
- A Party member is unfairly accused of theft. The punishment is cutting off the left hand. Fight the guards? Escape the guards (Skill challenge?) Prove innocence (How?)?
But much more important than the exact back story is in my eyes:
Make combat encounters diverse
It's not (only) the creature selection that makes an encounter interesting, but how you set up the battle. Let me make an example, with the same old 'bandit take village hostage' in three variations. I'm sure if you run it like that, the players won't complain it's always the same.
Devious, planning ba...ndits
The bandits have obviously heard of the wandering band of do-gooders and are prepared. First, they send in the dogs. Use skirmisher dogs that charge + make the enemy prone. Feel free to give them half HP or make some of them minions in order to make the battle shorter, but use enough different dogs they can't be locked down.
The dogs are backed by ranged attackers on the roofs behind chimneys - that means ranged attacks from cover, plus potentially combat advantage if they hid well. To get on the roofs, require at least a move action + athletics check. You can also make them minions, or at least some.
After two rounds, when the party is likely to be softened up, send in the Hog-Brothers, two large, burly fighters, brutes that will focus on the same target to make it go unconscious...
Trees are fun
Bandits have taken over the village, but the village is on a hill. When the party approaches, the bandits roll logs (trees) down the hills. That's a nice trap against Reflex that damages, secondary attack against Fortitude that slows. Once the party is up the hill, use charging brutes that push them down again. As always, use cleverly distributed archer minions to make it more dangerous.
Hostages
Again, bandits take over the village. Everyone is on the village square. When the party arrives, two bandits in the center threaten the peasants that were rounded up. Can the party lock down the two bandits and prevent an all-out slaughter, while fending off the other bandits? If you make the villagers run around frightened on the battlefield, you have another nice restriction: non-friendly area attacks kill peasants.
Build up a villain/villains
Don't worry too much about 'same backstory' for side encounters, it doesn't really matter as long as the fights are interesting. And you could build up a gang of bandits that terrorize the area... every session there's another gang-related side encounter. With time, the bandits also start hunting the party. This could tie diverse and interesting encounters together. Build one or two lieutenant for every side fight that has special capabilities (not magic, but either some leaderish/controllerish powers or a especially hard brute/soldier.
Best Answer
My group has just simply (for the sake of simplicity) just reduced whatever objects we find that have value to their gold value. This reduces book keeping and simplifies wealth in 4e.
However, if you want to pedantic, or show that an item is far more significant than a run of the mill gem stone there are skills in 4e that can be used for appraisal. In the Trade Goods entry in the compendium there is a section called "Buying and Selling:"
This is followed by a table with the prices of common items. Again, I would only use these rules occasionally, adventurers should have an idea of what the loot they find is worth, and its probably worth letting them just convert it to gold (As that is the point anyways).
So in short: Yes. Unless you want to show significance to a specific item.
Note: The RAW approach here would involve granting the players a Pouch of Platinum or similar which would allow them to automatically change gems into coins.