This is not specifically only a reply to you, but it seems like the two camps of "detailed specification on paper/word processor" and "code on the fly, because

This is not specifically only a reply to you, but it seems like the two camps of "detailed specification on paper/word processor" and "code on the fly, because the code is a document" are missing a third alternative, which is TDD (ie, the tests are the specification), and a fourth alternative, which is literate programming (the code and specification are written together).