TOD:
I'm not completely sure, but I would think that vocal styles first began to change with the development of the concept musical. While the straightforward musicals of the early part of the century preferred singers who were trained, sang technically well and pleasantly, too, the concept musicals stressed performances in character, which didn't always require a classically trained voice. For example, I'm thinking of Jill Haworth as Sally Bowles, half the dancers in A CHORUS LINE, Jerry Orbach (normally a fine singer) grating his voice through CHICAGO. I'm not saying these people sang badly, but that the shows that came along from the late 60s and thru the next 25 years had a more relaxed and naturalistic bent and this is reflected in the vocal performances of the period. Pretty voices still existed, but the reason behind the prettiness was now a conscious choice and not just the norm.
There was another change in the mid 90s, and I have no idea how it came about. But suddenly there were Celine Dion-esque howl-a-thons like SIDE SHOW, JEKYLL & HYDE and RENT with vocal pyrotechnics that existed for their own sake. This was before American Idol, so it can't be blamed on that (though there's been a lot more since the show became so popular.) Maybe this is some kind of influence from the Andrew Lloyd-Webber days or it's a desire on the part of composers to appeal to the vocal diva fans. I'm not sure where it came from, but I certainly do not like it.