The DMG II for 3.5e goes into player authored quests. I don't know if that term is used word-for-word, but the sense is certainly one of player authorship. I know that doesn't amount to something that's "always been done" but it does surely pre-date 4e. Publication date is 2005.
[EDIT Reading that 3.5e game text now, it's worded in a way that describes a preexisting behaviour, so maybe it really does support "always been done"? Language such as "Players drawn by this incentive are simultaneously easy and difficult to please. They are self-starters who provide material for you to work with and take your game in surprising new directions. To make full use of their contributions, though, requires a flair for improvisation." So there are those players, we know something about their traits, and so on. The text encourages a DM to listen to their players and develop out quests in directions indicated in their backstories, etc. There's a sense of attempting to bridge between play styles, suggesting to me that the author might indeed have felt that this kind of play was not common.]
Ah, now I know what section you're referring to. Reading through that, it does not (to me) read like embracing player-authored quests. Instead, it reads like someone talking about how there are players hungry to be
given plotlines and quests and such. Here's the full text of that section, with some particular emphasis added that I'll explain in a bit:
For these [story-oriented] players, the game is like a movie or a television show, but one in which they're taking part in the story.
Players who have this trait are not content with one incentive: They look to a D&D game for the full gamut of emotions you feel in a compelling narrative, from humor to horror, from suspense to celebration. Story-oriented players want plot threads and continuing characters. They want to take part in exciting events that unfold from simple beginnings, become gradually more involved and compelling, and then develop into exciting climaxes--preferably at the end of an evening, just like a night at the movies.
Players drawn by this incentive are simultaneously easy and difficult to please. They are self-starters who provide material for you to work with and take your game in surprising new directions. To make full use of their contributions, though, requires a flair for improvisation. If such a player makes a sudden decision for his character that takes your campaign story in an unexpected direction (which is not uncommon for players of this sort), this situation can be tough to adjust to, especially if you're more comfortable with carefully prepared adventures than with making the story up as you go along.
Story-oriented players typically supply you with a detailed background for their characters, which includes one or more plot devices for you to pick up on. Go through the back story with a highlighter and single out the passages that could serve as plot springboards. Staple plot devices include missing relatives, readymade conflicts with preexisting enemies, weapons with exotic histories, and deep, dark secrets the character hopes never to see revealed. Each implies a plot development the character wants either to bring about or to prevent.
The various bolded portions are what people mean by these things being "GM-authored" even though players are having input on it.
Especially the parts referring to it as "using" their contributions, or "adjusting" to their actions, or "a night at the movies," or "your campaign story." The underlined parts are more ambiguous, as they could be read as referring to either GM-authored or player-authored. However, in the context of the
several passages referring to clearly GM-authored things or a GM-as-author perspective, it seems pretty clear to me which of the interpretations is relevant.
To give an example of something very player-authored in my campaign (apart from my previous example): Our party bard. The player told me he wished to play a tiefling. I was hesitant, at first, because tieflings can carry some...baggage, as I'm sure you know, and I wanted to de-emphasize demons and devils early on (to help play up the Arabian Nights setting dress). So I asked him what he was going for, why this was interesting. On the one hand, it's just because it's something he thinks is cool; on the other, after some digging, he said he liked the idea of someone who has some questionable connections that he didn't choose. So I said okay, and then asked, "Which of your parents is or was a tiefling?" He thought about it for a sec and said, "Y'know what...let's say
both of them!" And that specific interaction suddenly meant there were
so many possible framings I could give so that this player could explore all those questions of lineage and inheritance, of defying others' expectations, of family history and the intertwining of bloodlines and all sorts of other things.
And that's how we got our surprisingly moral, upstanding,
non-philandering Bard. The player brought in minority communities of tieflings and their personal struggles against prejudice (mild, as my world is relatively bright, but prejudice nonetheless), and the ways he differs from his siblings, his "reformed" succubus great-grandmother, etc. I have since furnished the player with situations that frame his ancestry, and the mystery surrounding part of it, in all sorts of lights, so that
he can decide what these things mean, where they will go. Because of the player's authorship, we have explored genealogy with disturbing implications (his great-to-the-Nth grandparent on his dad's side is either
Glasya herself or the pit fiend Baalzephon), twice had the player investigate (and successfully pursue) the possibility of taking the fiendish power away from others so they can live free, and seen him tackle the (OOC and IC) uncomfortable issue of being seen as a
religious icon (by some...dubious folks) because of who he's related to Down Below.
I would honestly call the second of those "take the evil power away" moments one of the coolest events in our campaign. I was able to leverage something the player had told me (the assumed name that succubus great-grandma went by, given to her by her husband) into a heartwarming moment.* Events like these--like the time the Druid summoned a devil and very unexpectedly made a pact with him, or the time the Ranger had his world flipped upside-down for a bit because his
hated rich-bitch grandfather had begun a
genuine change of heart after Ranger rescued his young granddaughter, the Ranger's cousin--are some of the best and most memorable parts of my campaign. I have done a fair amount of work to
also provide my own, DM-authored story and plot elements for the players to enjoy. But it's these moments of crisis, of transition, of the player having to choose what their character
truly values and where things really could go almost any direction, that are the crowning glory of my game, at least in my eyes. The combats are fun (especially if the players respond positively afterwards), the roleplay is a treat (especially from the relatively shy player), and hearing my players speculate about what I've written (or, more often,
sweating bullets as I fear they will feel disappointed at an overly-predictable plot) is always cool. Those moments of...revelation, though? Of players putting a Value before me and seeking out Issues in which it might be tested? That's solid gold.
*In brief: great-grandad's name meant "moon," and (for her sweet singing voice) he called her a name that means "Nightingale." When she tried to give her powers to the party Bard, the ritual failed and she couldn't figure out why...until she realized
her true name had changed...specifically to the name her husband gave her. She's a new
kind of being now, and might get to join her husband in the afterlife. After giving our Bard all her powers, she somehow kept just one: her beautiful singing voice. She sees this as proof that her contrition was accepted.