I've never experienced the dwarven economy, but I did look through the 40d description of it, and it's bad.
Things to note:
Individual dwarven preferences have to be established, and this means for everything including intangibles like simplicity, variety, and risk. These need to be put into a vector where pairwise comparisons ranks them according to preferences that are complete (everything in the vector is compared pairwise with everything else) and transitive. Varying quantities of varying goods produce a series of iso-utility curves, or just utility curves, and the spot where some particular curve is tangent to the dwarf's budget, that's the basket of goods they'll consume.
Even Marx and Engles understood that prices are what make economies work. (Keep that in mind next time some idiot is extolling the ubermoron Ayn Rand who thought it was greed that was the key component.) The player will not be setting labors. The dwarves will be choosing labors based on wages resulting from a Walrasian Tattonnement -- good luck modeling that. The cost of apartments will similarly be determined by the market, and rent will only partially be determined by how nice it is; décor taste, location, neighbors, noise, among other things will determine rent. Same goes for meals: You might find yourself buried under cheese roasts with butterfly sauce because dwarves prefer rum biscuits dipped in brandy pate.
I can guarantee that the highest-paid professions will be food and refuse haulers, and if that's not the result, the economy has been incorrectly modeled: Dwarves are going to pay good money to ensure they don't have to suffer a case of PTSD-inducing miasma exposure. Who's hiring these haulers? Good question. That needs to be answered, because the dwarves hauling rotting rodents and rank food are also the dwarves who'll be least affected by miasma, and they're going to have all the bargaining power.
What does the player do? Look at prices and open or close workshops when there is either a shortage or excess of goods. Prices, in an efficient market, are the necessary and sufficient tool for determining whether resources are being distributed efficiently. The player will make decisions regarding plant and capital to affect supply in the hopes of meeting demand. In order to optimize, the player needs to be buying inputs, too -- even if one claims the land and its resources belong to the player, one is still paying the producers of the inputs for their labor. And to make it real... well, see below.
What about players' mining, planting, and construction plans? Depends. You, aka the player, have to buy products from the workers at the market rate -- though some will be appropriated through taxation -- and sell 'em for profit. This means you, aka the player, have a budget. Who do you borrow money from? This needs to be answered, because your dwarves aren't obliged to build the defensive walls you so desperately need after raiding that necromancer's tower. They can leave, change their names, and migrate to another settlement. So you got cocky, kicked a hornets' nest, and need the miners producing stone, masons producing blocks, and everybody else building defenses at a desperate rate. Congratulations! Welcome to Price-Gouge City, population You! You better have a line of credit with somebody because you're going to need to fund a war.
Speaking of which, your legendary swordsdwarves are going to be hired away as mercenaries and are probably off campaigning for Urist McPutz-Noble a couple of mountains over.
You see, a fun thing about a realistic economy is that capital and labor are pretty free to move around; i.e. scram when you need them most.
Even more interesting is that we'll be needing dwarven entrepreneurs who'll petition the king for permission to mine, log, &c. under royal license, and they'll have valid arguments, because if you the player were doing your job right, they wouldn't be seeing great market opportunities. Your miners might be working for somebody else who has a great idea for housing and is paying them more. Your farmers may be on the surface growing rhubarb to sell to the elves. It's the king's land and minerals, and if he wants to give license to a guild of farmers who wish to turn unfriendly elves into allies by way of favorable trading, it's his prerogative to do so.
And don't get me started on market failures.
Long story short, a game of DF's detail, complexity, and emergent play needs either no economy, or an economy done right. Toady can understand the math: See "Microeconomic Theory" by Mas Colell, et al. From what I hear, the modeling is right up his alley. But it's a BIG project. Please don't half-ass it.
On the plus side, if the emergent play does occasionally produce a dwarf with intransitive preferences, it would be hilarious to watch. Urist McStressed-Out went into a strange mood, became economically irrational, and died of thirst because rum was better than wine, and wine was better than beer, but beer was better than rum, which was better than wine...