Really it’s neither, but all jokes aside, the straight forward answer is that world regen takes care of the issues of leaf decay and grass seeding in a different way than other games, minecraft included. World regen is also the reason sand and gravel do not have the properties that their equivalents in MC have. These solutions break down inside of plots, who’s purpose is to halt the regen function inside their bounds. So, really the question is- how to handle these cases both within and outside of plots.
We have all seen the floating canopies of trees above plots where the trunks are inside of a plot and have been cut down, but the tops regen outside of the plot. The existing solution is to extend your plot to include the tree top, or build around the base of the tree so that the tree appears natural.
As for grass seeding, again, outside of plots is covered by world regen. Only regions inside plots need to be seeded manually. For some, this is a tedious process of breaking hundreds of grass blocks for a few dozen seeds. For others, grass seeds by the hundreds clog up their storage and sit for days on sales plinths. This seems to be a balance issue that may take some outside-the-box thinking to solve. Perhaps seeds need additional uses? A “seed sink” to help remove excess from the supply? Maybe as an ingredient in regen brews or to impart color to cloth like ink?
So really, the case here is not if we should apply real world physics or minecraft physics, but acknowledge that it is neither and operates on its own set of rules.