I use text files for creating a level by loading entity data, using an optimized way by putting them into categories thus minimizing the stored information, and for some other settings like materials, shadows etc. you can check it, it is open source, but its speed is much slower than loading a wmb level, mainly because of the speed of ent_create, and the limitation of the number of running actions/functions per frame. maybe a binary solution would be slightly faster, but I use it because of better debugging possibilities.
so I recommend to use a wmb as a basis of in-game usage, with some additional stuff for materials, and other extra entities which do not have place within the main wmb file, like some thousands of grass models...