The halacha requires that one dwell in the sukkah for the duration of the yom tov in the same way one would live in his own home: eating, sleeping, learning, etc. In the language of the Talmud (Sukkah 28b), "teishvu ke'ein toduru".
The Talmud (Shabbos 133b) speaks of fulfilling all mitzvos in an elegant fashion - an elegant talis, an elegant pair of tefillin, etc. The same certainly applies to the mitzvah of sukkah as well. In addition to that general halacha, making the sukkah fancy constitutes a particular enhancement of mitzvas sukkah because of teishvu ke'ein toduru. We all add drapes, wall paper, carpeting, etc. to our homes to beautify them and make them more comfortable, so the same ought to be supplied to the Sukkah.
In Yiddish folklore there was a common humorous saying that if one doesn't speak loshon hora at all in the sukkah, he hasn't fulfilled the mitzvah because it's lacking ke'ein toduru, since at home we always speak loshon hora. This is the historical background of the comment in the Mishan Brura (639, note 2) that one must certainly be careful not to talk any loshon hora in the sukkah. The Talmud (Sukkah 9a) derives a din doraysa from a passuk that just as a korban chagigah has kedusha, so too the sukkah has kedusha. According to the Ramban, this possuk is the source on the principal that all religious articles (eg. an esrog or tzitzis) become huktzah l'mitzvoson for the duration of the mitzvah. Because of the sanctity of the sukkah, one should avoid discussing divrei chol, and certainly loshon hora. The loshon hora belongs neither in our homes nor in our sukkos.
After one has finished eating it is considered disrespectful to the sanctity of the sukkah to leave around the dirty utensils which one no longer plans to use (Sukkah 29a). Some poskim write that is disrespectful to bring an infant into the sukkah who may dirty his diaper.
Towards the end of parshas Re'eh (Devarim 16:13) the chumash records the mitzvah to celebrate the yom tov of Sukkos for seven days during the ingathering season. All summer long it doesn't rain in Eretz Yisroel, and only after Sukkos, when we expect the rains to begin, do we gather in the produce from the fields. This is the literal meaning of the passuk's reference to the ingathering season.
The Talmud (Sanhedrin 34a) has a tradition that Hashem dictated the Torah to Moshe rabbeinu in such a way that any given passuk may have more than one level of interpretation: "achas diber Elokim, shtaim zu shamati" (Tehillim 62:12). The Torah she'be'al peh has an additional level of interpretation on the aforementioned passuk in Re'eh, which is that we should construct our sukkos in such a way that they should be sturdy enough to last for the duration of the seven days of yom tov, and the se'chach we use as the roof should consist of the branches, leaves, and chaff that are separated from the produce (i.e. something that grew from the ground, is now detached, and is not edible for humans, hence not mekabel tumah). This additional level of interpretation fits in to all the words of the possuk except for "chag", which means "a holiday". How, then, can the Torah she'be'al peh interpret the possuk to refer to the construction of a sukkah?
The Talmud explains (Sukkah 9a) that only Pesach, Shavuos, and Sukkos are referred to in the chumash as "chag", because "chag" indicates an obligation to bring a korban chagigah, which exists only on these three yomim tovim. "Chag haSukkos", therefore, refers to the construction of the sukkah which is compared to a korban chagigah. Just as the korban Chagigah is sacred, so the sukkah is endowed with sanctity after we sit in it to fulfill our mitzvah. Because of that sanctity we must treat the sukkah with proper respect.