Nowadays folks like to think of the modern game design as more sophisticated and more polished, which it generally is, and there's a mix of nostalgia and derision for early role-playing game design. It's not entirely undeserved -- early RPGs have some mind-bogglingly complicated exceptions to the rules, but there are also some hidden gems.
Anyone who's played a lengthy campaign of 3rd edition D&D (or 3.5, or Pathfinder) recognizes that there's a "sweet spot" for gameplay around levels 3-12. Your characters are competent enough that instant death is unlikely as a result of a single die roll, but they are not so complicated that finishing your combat turn takes a dozen choices and multiple references to multiple rulebooks. Beyond this level -- sometimes a bit earlier, sometimes a bit later, depending on how you built your character, but often exacerbated in Pathfinder because it makes characters even more complex -- the level of character options and the demands of gameplay choices make it hard to actually play the game. You spend so much time making sure that you have the optimum spells and powers, and computing all of your bonuses, that it slows down combat and even some non-combat situations. Heaven help you if one of your players is new to the game; it's going to come to a screeching halt. Plus there's the implicit contract in the latest editions of games, in which the rule books are supposed to cover every eventuality; the more complex your character and the greater your number of choices, the greater the likelihood that some action will devolve into a book war with players and GMs rushing to look up obscure rules to figure out who's "right."
Interestingly, 1st edition AD&D sidestepped all of this with a clever bit of design. It's rarely recognized as such, though, because the reasons for this design were never explicitly stated.
In 1st edition AD&D, your character classes come with associated "level titles." Your fighter might be a Swashbuckler, or a Hero, or a Veteran. This title is automatically assigned at a specific level, so this can cause some goofiness, because why is my greatsword-wielding, plate-armor-wearing fighter considered a Swashbuckler? At one point, level titles were so pervasive that in some adventure modules, NPCs were referred to by their level titles and if you wanted to know what level they actually were, you had to look it up in the class table.
Now, one of the built-in assumptions of AD&D is that low-level characters have adventures in dungeons, mid-level characters have adventures traveling overland, and high-level characters are landowners whose adventures are mostly political and warfare related, with the occasional jaunt into heroics. This divide is so explicit in D&D that the boxed Basic, Expert, and Companion sets made the division along the fault lines of the sets themselves; Basic characters tackled small dungeons, Expert characters went on long trips to wilderness locales, Companion characters ran their own landed domains, and Master characters engaged in the epic quests for immortality.
A consequence of this combination of level titles and implicit adventure styles is that characters in 1st edition AD&D have "name levels" -- the level at which you gain your final title. After this, you don't gain a new title, but you also stop gaining hit dice. In effect, your levels beyond this are fairly trivial (unless you're a magic-user and looking to gain high-level spells, of course). A fighter going from 9th level to 10th level gains 3 hit points with no bonus for Constitution. It's a drop in the bucket after 9d10 + Constitution bonus at each level.
What's going on here? Well, essentially, your game's got a soft level cap. Sure, you can gain as many levels as you want . . . but the returns for doing so are very limited. A fighter gains very little for gaining levels after 9th -- just a few hit points, maybe the occasional improvement in attack rolls or saving throws, and a better attack rate at level 13.
Contrast this with the 3/3.5/Pathfinder model, in which your character's linear advancement continues at every level. At high levels, your characters will have hundreds of hit points, with correspondingly ridiculously high attack bonuses and saving throw bonuses, plus any level-scaled class features at extremely high levels. As anyone who's played in an epic level game can attest, the system starts to break down because the divide grows too great between characters who have a high bonus and characters who don't. A 30th level fighter's attack bonus is so much higher than everyone else in the party that enemies whose armor class is challenging to the fighter are untouchable to the cleric or the rogue!
So 1st edition AD&D had a built-in mechanism for limiting your character's level scaling. After name level, your character's hit point gain slowed down, as did most other ancillary benefits. Some didn't -- the design was inconsistent, after all -- but a 12th-level fighter was really not too much tougher than a 9th level fighter. At that level, the character gained more benefit from magic items than from extra levels, really. A few character classes do not have a name level at which hit die progression stops, but these are all classes that have a built-in level cap -- the druid, the monk, and the assassin. They all stop at level 14-17 anyway!
Now, of course the fighter continued to improve in attack rolls. A fighter's attack table improves every other level up to level 17 in 1st edition AD&D. But, unlike the constant increase in Base Attack Bonus of 3/3.5/Pathfinder, there's another built-in limiter in the system: Armor Class. The ol' 1st edition Armor Class (which starts at 10, and goes down to get better) drops to -10 and ostensibly doesn't go below that. (A couple of monsters have AC better than -10, but one of them is a god with -12, who can't be attacked unless she allows people to attack her anyway!) There's a range of 21 points of Armor Class, and that's it. Essentially, your Armor Class "tops out," just like hit dice.
Speaking of hit dice, those don't just top out for PCs, they top out for monsters, too. Monsters top out at 16 hit dice. After that, a monster may be more dangerous because it has more special abilities and more bonuses, but no monster gets beyond the 16 hit die tables for attacks and saving throws.
Maybe it's incidental, or maybe it's an artifact of Gary Gygax's mad genius, but in 1st edition AD&D, you are actually playing a game that's built to keep your characters in the sweet spot. After name level, many of your improvements are fairly small. There comes a point at which your character cannot improve any more -- you can't eke out any more armor class, you can't get a better attack table, you can't get better saving throws; you can only add bonuses from magic items and spells. This, of course, makes sense when you go with the implicit gameplay that goes with name level: You gain the ability to construct a stronghold or guildhouse, and you're expected to be playing politics now, which means that more hit points and better attack rates are not really going to be much help anyway.
One pundit on the internet proposed what he called "E6," a campaign using the 3e rules in which characters simply don't advance beyond level 6. This comes from a similar impetus. In effect, 3/3.5/Pathfinder attempted to be infintely scalable, but with infinite scalability comes infinite complexity. At some point the system overburdens the players with too many choices, too many modifiers, and a breakdown between the values for optimized characters in a field vs. non-optimized characters -- at the very high levels, it's just far too easy to have a character who will never make a saving throw, always be hit by monsters, or never be able to score a hit in combat, because the gulf between character abilities becomes so great. (The epic level sourcebook tried to address this by making advancements in attack bonus and saving throws flat for all characters, but the gulf is already there.)
This hidden level cap plays into another important factor: demi-human level limits. If your fighter gains only minimal improvements after level 9, then a level limit of 7 or 8 is not nearly as punitive to a demi-human character. A half-orc, who can become a 10th level fighter, has just as many opportunities to build a stronghold and participate in high-level play (with magic items contributing much of his combat power) as any human character! For characters with low level caps, like a half-elf cleric or a halfling fighter, it's obvious that the intent is to use those classes in a multiclass format to supplement another class's abilities -- a halfling who wants a little extra combat ability is a fighter/thief, and even if he only has 4 levels as a fighter, he can advance as a thief with no limit and he gains the benefits of using better weapons and starting with more hit points.
Sadly, none of this reasoning is explained anywhere in 1st edition AD&D. So was it mad genius? Or just a fluke of design? With Gygax and Arneson deceased, we may never know, unless someone manages to ask one of their players.
Next up: Why have character classes at all?