Just read the Haynes manual and it states pretty much the same system i've been using on my bikes for years. I tighten the nhe nut while moving the steering head left to right. If you feel roughness in the movement, the bearings need to be inspected in the very near future. If they feel comfortable, tighten the head until you feel resistance in the steering, then back-off one-eighth turn. Always check to make sure there is no movement in the bearings by carefully manipulating the forks left and right. I've also found that all bikes feel diferent, so use your own judjement. Just remember,always adjust your steering head with the tire in the air. Slacken the bottom pinch-bolts at both forks, this is very important! When the steering is centre, it should easily fall left or right when the handle bar is pushed each way. If not, the bearings are too tight.
As quoted from the Haynes manual "The steering head is correctly adjusted when the forks fall easily to one side when moved slightly off centre." OK, i think that explains it ...oh yah, the locknut should be tightened to 48 foot-pounds, or 65 nanometres (i think thats what Nm stands for...)
Note!! I have personally witnessed steering-head bearings locking up due to lack of maintinence and hard off-road riding.This both sucks and hurts! Please do your part and regularly maintain your steering-head bearings