I don't have the time to look it up right now, but I remember seeing a /proc entry that removed the <1024 limit.
I agree that in the modern Internet, that really doesn't make sense, but going back, you had trusted admins (not just of your local box, but of the other boxes you were talking to), and in that environment it worked.
so think naive not moronic
remember, these are the same people who think that firewalls are evil because they break the unlimited end-to-end connectivity of the Internet. :-)