Mixed. Many folks use home-manager to configure their user environment with nix, and you can specify config files there. However, escape hatches to use regular files not managed by nix exist to make config tweaking faster. You can specify your config file contents in nix, which works well for server deployments, but for desktop use it usually ends up being a mix of seldom-changed config going in the nix definitions, and other things that, say, revolve around GUI tools for config tweaking (eg KDE apps) continuing to do their own thing.