Short answers, pulled from the story.
The role-playing video game genre emerged in the mid-1970s when university mainframes began running text-based games like Dungeon and pedit5. These early experiments ran on PDP-10 and Unix-based computers to translate tabletop mechanics into code.
Three distinct systems emerged to reward progress: the experience system, the training system, and the skill-point system. The experience system remains the most common and emphasizes receiving XP through combat and quest completion.
Dragon Quest launched in 1986 as the first attempt to recreate a role-playing game for consoles in Japan. It required simplifications to fit within limited memory and capabilities compared to computers.
Final Fantasy VII achieved phenomenal success with a record-breaking production budget of around $45 million. This ambitious scope raised expectations for future genre entries through dozens of minigames and higher production values.
Graphical MUDs soon became known as massively multiplayer online role-playing games starting with Meridian 59 in 1995. Nexus: The Kingdom of the Winds arrived in 1996 followed by Ultima Online in 1997.