When I started learning guitar back in 1978, I read up on theory too. I learned how to 'spell' chords by working out the note relationships in the chord chart at the back of my 'Hootenanny Sing-Along Song Book' (still got it!) e.g. Maj7 = R, 3, 5, M7; m6 = R, b3, 5 [optional], 6.
When I then went on to learn the major scale forms on the guitar, I found it had unexpected benefits:[list]
[*]I could play better by ear, e.g. hear a melody and play it (in any key);
[*]My improvisation improved, because I knew where the notes were and what they would sound like before I could play them; and.
[*]I could sight-sing from written music (at least in relative pitch terms - I don't have perfect pitch).
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Playing today on guitar or bass, I am always referring back to where I am in the chord and/or in the scale. A lot of this now goes on subconsciously, but it has stood me in good stead and avoided a lot of duff notes along the way.