Although documentation is not free, it should be cheap. By that, I mean that documentation should cost as little as possible to produce, so that you get as much of it as possible for your budget. Again, the major cost is in people's time, so you want writing documentation to be as fast (and easy) as possible.

The golden rule is that time that people are spending doing anything except writing down the actual content is overhead. You get the most bang to the buck by minimizing this overhead. And remember, the perfect is the enemy of the good.

There are two sides to this: the technical and the social. On the technical side, cheap documentation needs to be as simple to write as possible. To me, this means that it should use a simple markup language that is very close to plaintext, in a decent editor. (Web browsers do not qualify.)

(Ideally you want something where you can pretty much write basic text paragraphs and have them come out right. I think that you need some formatting, because some things really need it; ASCII art diagrams are just sad, and ASCII tables need a lot of futzing, especially if you have to revise them.)

On the social side, cheap needs a tolerance for ad-hoc things. Not everything has to be ad-hoc, but there should be room for people to just dump a couple of paragraphs in a file somewhere. Adopt the Google approach for finding things: just search everything. Then you can add more structure on top in various ways.

(In practice, many organizations use archived email lists for this purpose.)

Unfortunately, despite what I said about documentation needing testing, cheap also calls for a tolerance for various forms of inaccuracy, whether that's outright mistakes or just something that is now out of date. One way to deal with this is to have multiple levels of documentation, ranging from carefully vetted operations manuals to scribbled back of the text file notes. People can still be steered wrong, but at least they're not being mislead about how trustworthy the information is.

(I feel that the problem isn't inaccurate information, it's that people trust it too much. I even like outdated historical stuff, because it gives me useful and sometimes fascinating insights into how things evolved. But then, I'm a geek.)

There's an important secondary reason for making documentation cheap: it increases the chances that you'll be able to capture knowledge while it's still fresh in people's minds. The faster it is to write things, the more likely it is that people will have the time to write something down right after they've actually done it. (This is another reason for the popular 'send email to this mail alias to describe what you just did' approach to change documentation.)