Very interesting discussion, you've started, Lifejoy. Given all of the YNAB and Mint users on these boards, I'm surprised to see how many people don't line-budget! I think it's a good example of how things change over time depending on your spouse/family, changing needs, changing incomes and expenses, changing attitudes towards "extra" stuff, changing financial goals.
Over 17 years together, we have done versions of separate finances, detailed tracking and budgeting, ignorance is bliss, YNAB, and now, a very basic pen and paper tracking each pay period. At this stage, we are very consistent in our approach to money, needs, etc, and are comfortable with the frugality level of our lifestyle.
We don't have a separate "fun" category. I'm not sure what would go there! We do have categories for our boat, eating out, alcohol, tools, etc. But basically, I take our income each pay period, pay bills, put aside the $ for our operating expenses for the next 2 weeks, and funnel the rest into a variety of savings/debt places as necessary. In deciding on the "operating expenses" amount, we consult about upcoming purchases, and I add $100 buffer for miscellaneous stuff. Then we largely don't check the balance again until the 2 weeks are up. (I know many would find this totally crazy!) It usually works out pretty closely (I was $5 out last week!). We consult each other about larger purchases ($100?), neither one of us spends much on anything, and we are generally supportive of spending when needed. If we disagree, we wait it out, and over time find room in the budget if we decide to go for it (or it gets purchased with unexpected $ or a side gig).
This method gives us lots of flexibility, which we like. Many weeks we don't spend as much on groceries, but we go out to eat at the last minute, or decide to buy something that comes up on sale. We seem able to absorb a few hundred dollars a month of spending that is different every month and still meet our savings goals.