I've met one person who has received a MacArthur genius grant. He was one of my college English professors, and he had just published a novel that became really popular. He was also involved in a lot of local arts programs, and he spent some of his spare time tutoring at-risk teens. If anyone deserved recognition and financial support, it was him.
He told me that the MacArthur Foundation representative told him he could use the money for any purpose, not just to work on another novel or anything academic. He did take a year off from teaching to pursue some of his other interests, but he donated a lot of that grant money to the local community theater.