My guess is that since many vintage military tool watches were (in general) larger than 'regular' watches, folks started to take notice. What I mean is, I think that folks started to realize that a bigger dial, bigger hands and a larger case provided easier "user interaction". Hey, if the pilots use big watches that look neato, why shouldn't the layman have access to such a watch, too?
I also think that people tend to be larger in size nowdays, too.
'Tis a shame whilst hunting for vintage watches that so many of them are really just kid sized toy watches. There are so many of them that are gorgeously designed timepieces - they're just too small to be worn in this day and age.
By the mid 1950s, watches started to sprout in size (39mm-40mm) with the advent of the Bretiling AOPA Navitimer, the Rolex GMT 6542 + Sub 5512 and the Blancpain 50 Fathoms. Again though, please note that these watches were designated tool watches, but were available to the layman for the very first time.