Why is gedit not populating the Open Recent files menu option on 16.04
This appears to be a confirmed issue that manifests with GEdit, Gnome and Ubuntu combination. Here is a link to the bug - https://bugs.launchpad.net/ubuntu/+source/gedit/+bug/1570227
I do realize that this is not an answer but I can't really add a comment to the question due to lack on enough points, which is why this "answer".
I'm using Mint 18.1, but it's based on Ubuntu 16.04.
When I found this question, I wasn't even getting the recent files in the Open/ menu. It appears that the gedit developers are planning to move to that way of displaying recent files. However, I wasn't getting recent files in GIMP either, but I found some information that explains why.
Solution
Look under Preferences → System Settings → Privacy for the option to Remember recently accessed files. After enabling that, I get my document histories in the Ubuntu based applications again.