The first dining plan (as they are now) included appetizers, meals, desserts and tax for everyone. I don't remember if it included tip, but I think it did. It was a much better deal and they still hadn't jacked up the cost of all meals to make it seem like you we're getting more than you are, lol.
A year or two later, they started the "free" dining. I think the first one was offered in the fall.
I did the first one, the first time it was offered...but I found it to be a bigger pain than I ever wanted to deal with again and kind of stopped paying attention, so that's all the history I know.
The reason I don't like the plans is that they raised all the menu prices to make it seem like such a great deal, so if you're paying cash, it's even more expensive. Also, most restaurants took some good stuff off the menus, so a couple of my favorites disappeared. Finally, people have gone insane with reservations because they want to get the most out of their plan, so it makes it harder to walk-up and get a table. Those are my personal beefs with it, not necessarily everyone's!