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It depends what you want. In any historical game, the initial ratings are created using the settings you choose (whether in recalc or dev, random debut or not, etc...). You can still set the recalc mode even in development-only leagues, in those case then yes, they are only used for player creation to set their initial ratings.
Whether to use the defaults, or adjust them higher when you have a higher recalc setting, is more of a philosophical question. Is the primary reason for the adjust/weaken in your mind to control for small sample size as a whole, or to control for a small sample individual season? To me, someone with 500 AB over a 3 or 5 year period has enough that I wouldn't want to adjust them down. But to others, if they were doing a 5 year recalc, they'd want that limit at 1000 because you want the "200 per recalc season" limit in place.
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