> get the functionality using the fewest number of tables and fields.
Fewer and shorter are generally better goals.
Let's conceive of a metric called "noise ratio" which is defined as say the total number of fields in a table divided by the number of raw information bearing fields in a table. Using (1) summary fields, (2) lookup fields, (3) formula URLs and (4) the creation of extra tables just increases the noise ratio. It may not be a problem for the native implementation of any one particular feature in a table but over time hundreds of new fields get created that only inflate the noise ratio. I have seen client applications with dozens of fields that don't even get used but nobody dares delete them for fear the field may brake something if deleted.
>just have an IF or Case statement to hard code a formula to map the states to the sales territories.
As to your second point, if you use a formula what happens when the regions change their definition over time. If you use a formula the historic region associated with the state will change.
