Pins have been a part of Disney almost from the start. The current version started in Nov of 1999 by Disney to help celebrate the new millenium. It was seen by Disney as a great way for guests to interact with each other nad cast members. And so far even with the problems it has worked out. As to how they got the idea. From the 1996 Olympics in Atlanta. They saw how big pins were in that and thought it would be something Disney could do.
Here is an artical in the orlando paper about it...