One of the earliest instances of paid DLC, at least in the modern sense of the term, was for an original Xbox game from Microsoft called MechAssault, in 2002, which was four years before horse armor in 2006. But nobody's ever really heard of that game, so the horse armor shit was the first well known instance of it, and that was indeed around when DLC really started to take off as a Thing. But even before all that, though, PC game companies like Cavedog with Total Annihilation and, yes, Bethesda with Morrowind were still offering tons of DLC, it's just that it was free and they called it "mods" instead of DLC back then. That sort of stuff, free or paid, wasn't really even possible on consoles until around the time of the original Xbox and Xbox Live, and even then DLC for consoles didn't really start to boom until a generation later with the Xbox 360 and PS3. And if they'd ever gotten the idea of charging money for that shit back then on PC, and if people had let them get away with it at the time without murdering them in their
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Somewhat amusingly, here are a couple of GameFAQsthreads from 2009 with people complaining that the DLC for that MechAssault Xbox game cost more than the game itself could be bought at the time. And another thread with someone asking where's the DLC, so not only is this game probably the first to have paid DLC, it's probably one of the first to have access to its DLC lost due to arbitrary bullshit like the shutting down of servers and such (though apparently it's still obtainable through unofficial channels).
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