I sent an inquiry to AlphaZealot about the history of items, and he was kind enough to provide a detailed reply:
The east coast has been functioning with itemless tournaments since 2003, the west coast since 2004-2005. For a long time there were two camps of smash thought, one that argued for items and one that argued against them. The pro-item argument usually centered on the idea that items spawns were not random; they were on a timer and rotated between spawn points. Therefore, the location of these spawn points could be controlled and added a risk/reward type idea. The only problem left then were the exploding capsules/crates, something that could not be predicted in any way. In the end, the east coast won the argument, and Matt Deezie finally changed his rules to no items for TG6, which signaled the end of the debate.Article is continued in the following update.
The east coast for many years played with 5 stock. This went on until sometime in 2005 when MLG rules became the way to go. The west coast was using 3 stock until around this time. Again, MLG rules and 4 stock sorta took over in the late 2004 early 2005 era.
[...] There were really only a few tournaments that set the standards we use today, and they occured back in 2004. If you looked at it, the most influential tournaments would be FC in the midwest (and maybe JV's Michigan tournaments), Gauntlet, BOMB, H2YL's tournament series (game over/live or die), and TG on the west coast. MLG modeled their rules (with M3D being the person who did so) after these tournaments but particularly over the tournaments around DC because that is where he first began playing smash competitively. Once MLG functioned, their rules became a consistent force for tournaments; the rest of the community began adopting their rules as almost a standard (the idea being something like this: when we hold tournaments, do it with MLG rules, so when we go to MLG tournaments and large sums of money will be on the line, we will be ready).