For the purpose of creating content, how do block_view and the page callback defined in the menu hook relate?
hook_block_view() and hook_menu() aren't related at all, they're two completely independent concepts.

hook_block_view() is for defining blocks, which can be assigned to regions within the page template.

Items defined in hook_menu() are pages, for which a page callback is required to build up the content for that page.

I guess the slight confusion is that in Drupal 7 the page content is automatically assigned to a block in the main system region. Whatever you return from your page callback function for a menu item will be assigned to that main system block when you access the defined page.

A block is not accessible through a URL; it is a contextual piece of information that you add to different pages/regions when you need to. Think of the shopping cart in an e-commerce site as a perfect example of a block.

A menu item defines a page that is accessible through a URL, and may well contain any number of blocks within it.