Navigating in the real world

I've been thinking recently about road signs. The long winter evenings really do fly by...

Navigating your way through a city is a complicated problem. There are many thousands of potential routes, many things to find. As a user (or, you might call it, driver) you usually have an idea of where you want to get to, but you need help to choose the right path out of the hundreds available.

You pass through many decision points, and it's important that it's clear to see which one to take. If you take the wrong one by mistake you need further help to get you back on track. And if you get really lost, you need a clear indication of where you are so you can find your way to the correct route.

This all sounds kind of familiar doesn't it? Sometimes, when driving a unknown route (particularly in a new city) you get hopelessly lost. Sometimes though, the signs make it easy to find your way. All of which got me thinking - how do the people designing signed pathways through cities go about it? What's their methodology? How do they work out optimal paths, and make sure they're properly signed? What can information architects and web designers learn from them?

I haven't found out yet, but I'm going to carry on looking. If anyone can point me in the right direction, I'd be very grateful.