My take is that the player with 8 pages of backstory with 'my character is so awesome' Mary Sue-ness is something of which everyone has seen an example, but in general is overblown in prevalence in games actually played and something of a bugaboo told in tales of worst gamers everyone has had to deal with.
Players with excessive backstory in general is certainly a thing. Some people want game-token characters; some people want characters mostly defined by the emergent events that happen during gameplay; and some people want characters with fleshed out histories, personalities, and motivations right from the start. This is not a new, modern generation thing and many not-new systems like GURPS hinge on characters starting play with connections, personalities, places in society, physical qualities which may require/facilitate backstory explanations, and so on. I think the main issue is people who would like to mess around with these things showing up to game tables (and game systems) not suited to them, and this is in part an artifact of whatever majority percent of gamers it is that are playing D&D or D&D-alikes, despite it not necessarily being the system most suited to their goals.