A couple of years ago I read the 1st Ed PHB & DMG for the first time, and it proved an eye-opening experience. Amongst the things I'd been "doing wrong" for years was alignment - it appears that per 1st Ed "team shirt" alignment was actually the 'correct' interpretation. As I have absolutely no desire to use "team shirt" alignments, that adjusted my thinking on the topic somewhat.
When you make a character, is alignment a choice you make or something based on your actions?
In the past, the way it worked IMC was that players would choose the alignment that they thought was probably the best fit for their character. Thereafter, if I (as DM) felt their actions consistently fit another alignment better then the next time the character sheet was updated I would quietly note the change. (If there was a mechanical impact on the character - for a Paladin, for example - I would have a quiet word with the player in advance of this, but purely as a courtesy. IMC alignment followed from actions, so by taking particular actions the player had
already chosen a new alignment.)
Incidentally, I never did the whole "you can't do that, you're {whatever}" thing. Unless the character was somehow magically compelled (and most of the time even then), the player got free rein to choose their character's actions. It's just that them choosing certain actions could cause an alignment change.
Do you actually care about alignment?
These days, I don't care about alignment except for Paladin characters. In fact, I'm going to be dropping alignment restrictions for every other class with my next campaign. I would drop alignment entirely, but it's a little too embedded into the 3e rules for that to be done easily.
However, the Paladin is a bit of a special case. The archetype there is very definitely the holy champion/knight, and the LG-only restriction (or, actually, the code) is absolutely key to that. Further, it
needs to be tied into the mechanics (IMO), or what you actually get is the "morality of expedience" - the character will be upright and honest and good... right up to the instant where it becomes even marginally difficult, at which point compromises will start to be made.
So what I may well do with the Paladin is beef up the code somewhat and drop the formal alignment restriction (which actually makes very little difference in reality). But that's hardly an ideal solution. (If I were doing 3e again, I wouldn't have a Paladin class at all. Instead, I would include various Exalted powers that any character could take through feats, but that were contingent on following the Code. That way, a "Paladin" is just a Fighter with the appropriate powers chosen.)
(Incidentally, alignment has only very occasionally been any issue in my campaigns, generally because a player wanted to play a particular class, but didn't want to abide by the alignment restrictions. In which case, they got to choose: the class they wanted, or the alignment they wanted. Probably for that reason, Paladins were and are extremely rare in my games. But that's absolutely fine - plenty of other classes out there!)