I think the only time I ever just freestyled in an actual day to day activity was when I was messin' with my friends doin' it at the train station whilst we waited for the train, and then the ticket man came around and I just rhymed a few lines to ask him for a ticket and shit. He gave me a wierd look and laughed.
That was purely on the spot though, I've never really planned on doing it before.