long(er) brake blocks came in with the original 'deer head' XT I think. Prior to that the longest brake blocks were the Mafac five stud and the Scott-Matthauser brake blocks. Then there were one-piece brake blocks such as Aztec, Kool Stop, and Fibrax versions. The 70mm cartridge ones we are most familiar with came (I think) with a 8s XTR groupset which came with the first version of 'parallel push' V brakes.
I think the logic was that a longer brake block that was thinner would last as long as shorter fatter one, but require less adjustment in the meantime; just as well with the slightly reduced running clearance that came with V brakes.
There is an argument that the longer (and in many cases offset) brake block is more stable against the rim, and thus twists less, allowing more even wear than you might get otherwise, and perhaps reducing squeal. There may be something in this, but that is not to say that brakes with shorter brake blocks don't work well, and that brakes with longer brake blocks never squeal....
One thing is clear; that is that the shorter ~55mm shimano 'road' pattern brake blocks offer the widest choice in insert compounds. IIRC Swissstop ones are no longer made in the 70mm fitment. Annoyingly there are few options for post-mount 55mm insert holders, which is what you might prefer for a lot of older canti-brakes.
BTW the 70mm brake blocks don't usually badly obstruct the passage of the wheel on an MTB with decent mud clearance, but they do on a lot of road bikes. Then again most caliper brakes don't open up far enough to allow a fat tyre through either.
cheers