I am a big believer in section headers for anything longer than, say, three pages. Very few of us can write long, elegant passages that flow naturally from one topic to the next, and even if you can pull it off, those long passages make it difficult for your readers to locate what they need.
I am a bit scatterbrained, and I pull my understanding of the geology from lots of different pieces. So having lots of labelled subsections allows me to impose order on what I'm writing. If the subsections are too short, I can always move them around and merge them later.
When I'm reviewing a report, I have a pretty wide latitude for report organization. You want to have 6 major sections and give each section 21 subsections? Ok, as long as the reader can follow along. You have 6 different levels of nested subsections? Ok, but after a while I'm going to lose track of whether this is section 22.214.171.124.2.4 or 126.96.36.199.2.4. Usually an organization will have a style guide that will dictate the section organization to a large degree.
There are still rules, however.
1. If you divide up a section into subsections, you cannot just have one subsection. For example, if you're in Section 2.1, you'd better also have a Section 2.2.
2. Strive for parallel construction. If you talk about metals and organic compounds in Area A (Section 2 = Area A, Section 2.1 = metals, and Section 2.2 = organic compounds), and then you discuss metals and organics in Area B in the next section, then the subsections should be Section 3.1 = metals, 3.2 = organic compounds. Not metals and organic compounds, not a long narrative with no subsections.
3. If you have long, meandering discussions where you talk about analytical methods and then results for this class of chemicals and the groundwater flow paths that show that they're going this way and oh by the way this other group of chemicals has these properties and oh look there's a squirrel... fix that. Start with section headers. At the very least, looking at the jumble of section headers in the table of contents will alert the reader to what they're getting into.
In the environmental field, getting your reports organized properly will save time, money, and goodwill from regulators, opposing consultants, and the public. Incomprehensible reports make those important stakeholders think you are a) incompetent and/or b) hiding something. This does you no favors in the short term or the long term.