Did some more checking, and found some answers... (I think..)
The detailed links from the http://www.faa.gov website didn't seem to lend themselves to posting here, but do a search for 25.1001 and you'll get the pertinent hits...
Re: the "125%" requirement... While that number sounded familar to me, the reg actually said...
"Sec. 25.1001 Fuel jettisoning system.
(a) If the maximum takeoff weight is more than 105 percent of the maximum landing weight, there must be a fuel jettisoning system able to jettison enough fuel to bring the takeoff weight down to the maximum landing weight. The average rate of fuel jettisoning must be at least 1 percent of the maximum takeoff weight per minute, except that the time required to jettison the fuel need not be less than 10 minutes. This must be shown at maximum takeoff weight, with flaps and landing gear up, and in--
{balance deleted for brevity]"Note that I used the past tense "said", as this was the version of 25.1001 effective on 02/01/1965.
On 09/29/1968, FAR 25.1001 was amended to read:
"Sec. 25.1001 Fuel jettisoning system.
(b) The turbine engine powered airplane must have a fuel jettisoning system installed that meets the
requirements of this section unless it is shown that the airplane meets the climb requirements of
Secs. 25.119 and 25.121(d) at the weight specified in paragraph (c) of this section.
On a historical note, since the original models of the DC-9 came out in 1965, I'll presume (since I can't recall any detailed DC-9 data that far back) that the DC-9-10 met that 105% criteria. When the first 737-100s were built (1966, 1967?), perhaps they did as well.
My guess is that as the subsequent DC-9 and 737 variants were under consideration/design, it was realized that there would be a problem in complying with the 105% requirement. Stretching the airframes and hanging newer versions of the JT8D would be useful improvements, but they'd be effectively rendered moot if the increased spread between max takeoff and max landing weight mandated design/manufacturing changes to incorporate a fuel dump system.
Accordingly, FAR 25.1001 was changed in 1968, and it deleted the 105% requirement, replacing it with revised climb requirements and dumping timeframes.
