Ah, that one. Good times.
No one says that. Why exaggerate/lie to emphasize Apple's underdog status? The woe be Apple days are gone. Evolve!
Trade dress and copyright used to be the only way that software was protected in the US. The good thing about those is that they really are unique manifestations and implementations of ideas, unlike the generalized ideas we see getting patents.
There are groups who suggest a middle ground: allow software patents, but limit them to two years.
I agree with your post, by and large. But I don't believe it's true that US software patent history began in the 1990s. What is true, I believe, is that the legality of software patents was established around that time (or perhaps late 80s?).