Update README

README.md

@@ -294,51 +294,45 @@ nix invocation.
 
 #### Tracked files
 
-`nix-direnv` makes a performance trade-off and only considers changes in a
-limited number of files when deciding to update its cache.
+As a convenience,
+`nix-direnv` adds common files to direnv's watched file list automatically.
 
-- for `use nix` this is:
+The list of additionally tracked files is as follows:
 
-  - `~/.direnvrc`
-  - `~/.config/direnv/direnvrc`
-  - `.envrc`,
-  - A single nix file. In order of preference:
-    - The file argument to `use nix`
-    - `shell.nix` if it exists
-    - `default.nix` if it exists
+- for `use nix`:
+    * `~/.direnvrc`
+    * `~/.config/direnv/direnvrc`
+    * `.envrc`,
+    * A single nix file. In order of preference:
+        + The file argument to `use nix`
+        + `default.nix` if it exists
+        + `shell.nix` if it exists
 
-- for `use flake` this is:
-  - `~/.direnvrc`
-  - `~/.config/direnv/direnvrc`
-  - `.envrc`
-  - `flake.nix`
-  - `flake.lock`
-  - `devshell.toml` if it exists
+- for `use flake`:
+    * `~/.direnvrc`
+    * `~/.config/direnv/direnvrc`
+    * `.envrc`
+    * `flake.nix`
+    * `flake.lock`
+    * `devshell.toml` if it exists
 
-To add more files to be checked use `watch_file` like this
 
-```shell
-watch_file your-file.nix
-use nix # or use flake
-```
+Users are free to use direnv's builtin `watch_file` function to track additional files.
+`watch_file` must be invoked before either `use flake` or `use nix` to take effect.
 
-Or - if you don't mind the overhead (runtime and conceptual) of watching all
-nix-files:
-
-```shell
-watch_file $(find . -name "*.nix" -printf '"%p" ')
-```
+#### Environment Variables
 
-Note that this will re-execute direnv for any nix change, regardless of whether
-that change is meaningful for the devShell in use.
+nix-direnv sets the following environment variables for user consumption.
+All other environment variables are either a product of the underlying nix invocation
+or are purely incidental and should not be relied upon.
 
-`watch_file` must be invoked before either `use flake` or `use nix` to take
-effect.
+* `NIX_DIRENV_DID_FALLBACK`: Set when the current revision of your nix shell or flake's devShell are invalid and nix-direnv has loaded the last known working shell.
 
 ## General direnv tips
 
 - [Changing where direnv stores its cache](https://github.com/direnv/direnv/wiki/Customizing-cache-location)
 - [Quickly setting up direnv in a new nix project](https://github.com/nix-community/nix-direnv/wiki/Shell-integration)
+- [Disable the diff notice (requires direnv 2.34+)](https://direnv.net/man/direnv.toml.1.html#codehideenvdiffcode) : Note that this goes into direnv's TOML configuration!
 
 ## Other projects in the field