For a Spartan-3 series device, area optimization is on (by default) and the MMU is not available in an area-optimized MicroBlaze.
1. Right-click on the MicroBlaze instance in the design.
2. Select "Configure IP".
3. Select the "Instructions" tab.
4. Deselect the Optimization box.
You should now have various options available to select under the MMU tab.