Arguably, this hurt the game, as DMs became personally responsible for handing out treasure. Eventually the official advice for this became as structured as an office Christmas party gift exchange, with treasures carefully rationed out in a challenge- and level-appropriate manner. Gone from this approach, as from the DM-controlled approach to encounters, is the feeling of discovery for the DM that lets him or her participate in the players' exploration, when preparing an adventure from random elements or from a published module - both of which, of course, still allow for sensible adjustments.
I hardly need to point out that the first edition DMG is organizationally a mess. In this case information about generating treasure is scattered in three different parts - the section on gems and valuable items, tables in the back for generating random maps, hoards and magic items, and a fateful section on pp. 91-92 which gives Gygaxian advice on treasure.
The tables seem entirely compatible with the OD&D/Monster Manual approach, expanding on the OD&D magic item tables and providing random determination for hoards that might be guarded by traps, locks or puzzles rather than monsters. Trouble starts with the valuable items section; while eye-opening, it's hardly clear how furs, ivory, perfume and other luxury goods fit into the random treasure system. And then in "Placement of Monetary Treasure" ...
|"This is not a contradiction in the rules!"|
This statement is the tip of a toxic iceberg that lurks hidden throughout the DMG. Gary has been burnt by high-treasure campaigns, and now it has become his white whale. Restrict acquisition of treasure - a party of 5 would have to defeat 333 orcs and pick up 333 of these exemplary 11-20 gp value troves to get the 10,000 xp required for most of them to make it to 2nd level! And wrest it out of players' hands wherever possible - through student-debt-sized training costs, taxes and levies, spell material costs! If by-the-book OD&D can be impossible to figure out, by-the-book AD&D is impossible to play and enjoy.
A bit later, Gygax gets more sensible with the example of two tough ogres guarding 2000 gp, and downright poetic in detailing the use of valuable items and equipment to compose the trove. However, this is still only a tiny fraction of the xp a 3rd-level party would need to make 4th level, the ogres themselves being worth at most 250 xp each. Clearly, AD&D was a game made to be played several times a week, with 40-50 encounters fueling advancement in each level.
A much healthier approach in the DMG, though presented as an afterthought without the authority of Gygax's ex cathedra rumblings, comes from the Appendix A random dungeon generation tables. There, 60% of monsters will have treasure and an average monster-guarded hoard works out to about 600 g.p. per dungeon level.
What has always been lacking, until about 3rd edition, was a comprehensive treasure table that would include all kinds of interesting and surprising finds, scaling well with the experience charts. This would let the DM be objective in placing treasure, while making the generation of adventures more of a surprise and less of a chore for him or her. The droughts or excesses of treasure that would worry some people can, of course, be dealt with intelligently - either allowing such variance as part of the realism and excitement of the world, or filing off the rougher edges to give a steadier experience.