Also, it does seem like the question has been skirted a bit. While going to the gym or taking a nap may benefit one's work, it clearly goes under the category of non-work.

Think of it this way: if you bill clients for hours while you are at the gym and if they find out, you could very plausibly be sued by the client for that money back. Very few people consider the gym "working."

If you really are more efficient during your working hours (according to my definition) because of what you do in your non-working hours, you can justify charging more for your working hours.

I think about the time I started consulting I left that concept behind. If I'm watching TV and working on an ad mailer, is that marketing or goofing off? If I'm walking in the morning prepping for a sales pitch, is that exercise or sales? When I'm working on a report to a client and grooving on the iPod, is that having fun or work? When I wake up at 2 in the morning with some cool blog article idea is that marketing or a hobby? The categories just don't fit. It's not like you punch a clock or something. You should always be doing stuff that has value. You should always be goofing off. No need to split the two up. If you think you're only working when you are on some schedule where somebody else is paying you by the hour, you're wasting your life away.

And even if you think of 9-5 only as work, what amount of that time are you actually doing something of value? An hour? Even if you're humping code 14-hours a day, or especially if you're humping code 14-hours a day, you're getting in to a rhythm. Work a couple of hours, read email. Work an hour, stare out window. Eat lunch, drink caffeine, etc. It's all geared towards finding a natural rhythm. Maximizing your productivity is all about finding your natural rhythm and going with it. That means, yes, "goofing off" while you're on the clock. Some of the best teams are the ones that are able to have fun and relax. And it's well worth paying for their time to do so.

Sorry about getting on the soap box.