An Example of the Sandbox in Action
It is frequently said that there are no plots in sandbox campaigns. This is a misconception. There are no DM-imposed plots. That is true. But instead of one uber plot, there are many plots. Each and every actor/NPC/organization has their agenda; that's what makes the world feel real.
How does that square with the other sandbox rule: player freedom? The ethos of the sandbox is that the game is about the players' plots. The various NPC plots aren't going to force the players to make one choice or the other.
Simply put: many of other plots counter act each other
But that doesn't mean that the world doesn't change if the players don't act.
The characters have of late been confronting the Sinister Shroom from Matt Finch's The Pod Caverns. In our Yggsburgh/Castle of the Mad Archmage campaign, the Pod Caverns are in the Little Hillwood. After getting his Shroomy nose bloodied in raiding traffic on the Menhir Hills road (by the PCs no less), the Shroom set his sights upon terrain more to his advantage: corrupting the vegetation of the Little Hillwood itself.
But this is a sandbox with character freedom, so the players were free to choose to ignore the threat. Finicky players that they are, they sometimes seem to scorn DM given hooks on purpose. The consequence: the Castle Track (a road through the Little Hillwood that led to Zagyg's Castle) became over run with constricting vines, giant venus fly traps and other incarnations of malevolent flora. Ever headstrong, the players decided instead to find other routes to their preferred source of mad lootz. They went up the Urt river.
So the players ignored the Shroom. But there were other actors in the Little Hillwood, which is the home of a bandit clan, a tribe of carnivorous apes and at least one tribe of goblins. None of these were going to let the Shroom take over.
That doesn't mean that the Little Hillwood is going to be the same. Player choice still effects the world, even as their choice isn't forced. When next traveling up the Menhir Hills road, the party observes many small fires burning throughout the Little Hillwood. And the next time the party encounters the carnivorous apes, they may unfortunately discover that the apes have found a source of pitch within Grey Pools Mire and have a habit of using it to set their enemies aflame. The goblin tribe Double Daggers (do you know your goblin gang signs?) are following a new shaman that has druidic powers. The Little Hillwood is not at all the same.
This is fun kinda stuff that co-DMs get to geek about over beer.