I think that the best way to Make a game is the. "layered approch."

With this approch, you can minimize the stress of tracking your elements and make better and more complex games with ease. This not only is a discussion, but a bit of a FAQ, I guess.

First off, you should think of the basic premise of the game that you wish to create.

Examples:

-Ogre kidnaps V.I.P. -> attempt rescue

-Crystal that controlls reality is loosing power -> find out why -> if possible reverse effects

-Legendary item is learnt about -> try to find it

...Etc. (there are many more)

Once you figure that out, it is time to sit down and flesh out your idea. I like to do this as I play around in the system data, creating spells, monsters and what-not. I find that the game tends to "gel" while I'm doing this, however, your personal style may dictate other ways of doing this. Drawing, and listening to music tend to get my inspireational juices flowing, so you could try that. You could also try going outside for a walk, mixing a phat beat (if you are into that sort of thing), or bounce your ideas off of a friend (like the rest of this forum, we're cool like that. ).
However you get that idea fleshed out work on your System data and get that finished (for RM 2 and 3 users, this is Monster, VFX, world and dungeon map, and character creation).

Now that you have all the elements that will make up your game begin scripting your story. Keep it basic. Remember all you want to do first is script THE STORY. If there is a feature that you wish to add, do so later. The idea at this point is to make your game bare bones playable from start to finish. This process can be broken down even more by sub deviding (in you mind at least) the dfferent "sections" of the game. For instance, suppose the game starts and you have to go to the "cave of doom" for what ever reason. All the events leading up to that would be one section of your game. Now suppose that once you have had the player plumb the depths of said doom filled cave, they discover a larger mystery that flings the player on to another area. Any thing that leads up to that new aventure is another section. So on and so on.
The upshot of this is that you only focus on perfecting a small area of your game at one time, and as such, can realy focus on the small details with out worring about the larger picture. As always, BARE BONES (for now).

Ok. so you have written the basic story of your game, and made sure that it WORKS. At this point, you can release it as a demo if you wish, as it is only bare bones and it will whet your audiences appetite for the full version. Another way to do this is to flesh out the first section of your game, then delete any unnessisary elements, then save the game (TO A DIFFERENT MEMORY CARD(s)!). you can release THAT as a demo as well, if you don't want to give up all the secrets of your game. Eather way, now you can go back over an polish up the game. At this point the features are all up to you, however, subquests are nice additions, as are simple CBS's (In RM1, they aren't as hard to make as you would expect!). There are also a few nice graphical things you can do, like add ambiance to certain areas like fog for swamps, or "random" "earthquakes" for mountainus reagions, or simple sound effects that realy bring your game to life. Now is also to go back and check for spelling errors and do general debugging.

So! lets recap:
Game idea -> Expansion of idea -> World & Character creation -> Script story -> Debug -> (Add features then) Release Demo -> Add major sub-quests -> Add minor sub-quests -> Add optional things (ex., CBS, VFX, and/or SFX, etc.) -> Final release.

For me, the story usually comes first with the characters coming as a result of it. In some cases though, I'll specifically taylor the story to suit my needs, whether I need to come up with a story for a Lode-Runner type game or I want the story to somehow involve a Ryu-like character.

Then the story gets fleshed out. Ideas for subquests come along the way, sometimes even helping flesh out the story even more, though these are planned last overall. And if I can, I'll throw in extras.

My approach to game design is different.

I consider the RPGMakers to be Game Making Games rather than High Level Programming Languages (High Level just means closer to the user's language than the machine's language).

Thus I am just playing when using them.

As a result I end up with a very Zen like project.

I often just start doing things with no plans whatsoever. I have created my best stuff this way.

After I have a bunch of pieces I just nail them together into a story.

This works because I make comedy games and have a Big Hammer.

Zen is the art of doing without thinking.

It is taught in many Martial Arts classes as things there often happen too fast for you to stop and think about what you are going to do.

Many artisis create this way. And us Old Hippies just love Eatsern Mysticism.

So I guess I design by not designing.

But I have fun. And that is why I use the RPGMakers.

It is nice that I have been told my stuff is fun too, but to be honest I'd make this stuff even if people hated it. I just like making ridiculous games.

It may not be the kind of answer you were seeking, but it is my style and therefore worthy of mentioning.

Peace.