@philipwhite In my experience since the grid approach is usually all about convenience/simplicity, a close to a square shape also makes it convenient for artist to work on the atlas directly using ordinary image editors. Otherwise if you are using atlas generating tools, you'll usually go with some kind of packing algorithm, which will usually trim any sort of padding from each asset and store it as an offset, making even monospace font glyphs worth packing. That's why you won't commonly see long thin atlases, and when they do come up they are often themselves packed into a bigger atlas, which would be squarish either for packing purposes or convenience of manual editing.
If untrimmed 256 glyph monospace font is all you need, no reason to make it square.