Not going to be a very long post, but thought it wouold be useful to show the difference between a raster with a continuous color ramp applied to it, versus one that has had discreet elevation zones colored. Basically, for data that varies continuously across space (like air temperature, or elevation), I think it is better to use a continuously varying color ramp. With data that is the result of a discreet classification process (like crop types, or soil types), it's probably better to use a discreet color ramp. You can see the differences below. They're subtle, but especially noticeable on the hillsides.
Ignoring for the moment that this is an ugly color ramp, it does show how the same color values applied in different ways can subtly alter the nature of the image. The beauty of the discreet ramp is that you can highlight specific ranges of color. The beauty of the continuous ramp is that you get soft transitions between zones, and arguably a more true-to-life representation of a data type that doesn't have hard boundaries. Oh, and one more thing the continuous ramp does is allow you to use a smaller number of breaks, and still get a smooth looking ramp. Like in the bottom image.
Discreet color ramp
Continuous color ramp
4-color + water color ramp
