Although Francis didn't set up the first such display, he and his order certainly popularized the idea, and they were quickly joined in their efforts by the Dominicans and later by the Jesuits. In Italy, such representations, which can be anything from larger-than-life to tiny miniatures, are known as "presepi". (The singular form is "presepe" although "presepio" is also often used. It comes from the Latin word praesepium, originally meaning a stall or cattle pen, from: "pre" = before, in front of, and "saepes" = fence, hedge.) Catholic missionaries spread the concept worldwide in the "Age of Discovery", the late 15th and early 16th centuries. Wherever in the world presepi were installed, they were used as visual aids in preaching the Christmas story. That was also the original purpose of "living nativity scenes" and of children's' "Christmas pageants" that are still seen in Christian schools and churches at this season.
What is said to be the oldest existing presepe is the set of marble sculptures by the Florentine artist and architect Arnolfo di Cambio and is variously dated from 1284 to 1289. The scene is arranged in a small chapel in the crypt of the Basilica of Santa Maria Maggiore (which, for a time, was known as Santa Maria of the Presepe) here in Rome, although they are not always available for viewing. Other presepi are sometimes said to have some older individual figures, but the five figures of the di Cambio are the most complete set. The most famous presepe in Rome is probably the one in Santa Maria in Ara Coeli, above the Campidoglio, where Rome's "official" Christmas Midnight Mass is celebrated by throngs of Romans (while the tourists are all at the presepe in St. Peter's Square.) All of Rome's churches set up presepi for the Christmas season, and some have year round displays -- the Scala Sancta Church (next to St. John Lateran), the Gesu, and Santa Maria in Via (near the junction of Via del Corso and Via Tritone) are among the latter. The church presentations come in various sizes and levels of sophistication, but the simpler ones seem co carry the message best. The city of Rome annually erects a large presepe on the middle platform of the Spanish steps, but it is cluttered with extraneous structures not related to the Christmas story. It usually is inaugurated on December 8 which is the same day the Pope comes to Piazza di Spagna for the feast of the Immaculate Conception. If you don't enjoy trekking from church to church (or if the trek doesn't satisfy you quest for presepi) there is an annual display of "the hundred presepi" from around Italy and other parts of the world at the Sala del Bramante in Piazza del Popolo from early December to mid-January. There are always closer to 200 examples on view, but the name of the exhibition was chosen in the 1970s when the first show was organized with 100.
There are, of course, dozens of books on the subject and they are available at Roman bookstores and from online booksellers.
Internet links also abound:
About.com has a multi-page presepe site with links elsewhere. http://italian.about.com/library/weekly/aa120899a.htm.
The history of the "Neapolitan" crib: http://www.presepenapoletano.it/amicipresepe/amipre8.htm
You can visit Greccio, and the church at the site of St. Francis's presepe at http://www.emmeti.it/Welcome/Lazio/ProvRieti/ValleSanta/Greccio/index.uk.html
For information on presepe/creche/nativity scenes in other part of the world: http://www.geocities.com/creche_school/index.html . This site also offers a "Creche Course" on how to build your own: http://www.geocities.com/creche_school/crechecourse.html.
Go to http://www.mmdtkw.org/Veneto2002.html for other articles.
P.S.: Francis and his monks are also said to have invented the "Christmas Carol". Once again, there is no real evidence that this is true, although Christmas verses by Francis are attested, and it is recorded that the monks sang at Christmas observances from the earliest years. Unlike the presepe legend, there is no contrary evidence that says that Francis was not the inventor.