If I know my conversation is intended to a small group I'll reply inline, but my default is quote-on-top.
There is a MIME type for emails, so you can attach emails to emails, retaining their identity as emails, so the receiving MUA can display the emails you receive as an attachment just like any other emails, including the user interface for replying to them, or whatever.
Also, there is threading information in email headers. So, it is actually trivial to just gather together all the emails belonging to a specific conversation and attaching them all to an email to a third party that needs the history.
Using this bottom full quote nonsense is about as sensible as attaching a screen shot of a word document or something.
That brings up another point about using email for group conversations. If organizations hosted their own NNTP servers and commonly installed email clients also supported communication via NNTP, then this wouldn't be a problem. All messages already posted to a group would be visible to anyone who joins it at a later time. That's not the case with an email discussion that gets Cc'd to someone at a later time (since they don't have any of the earlier messages in their mailbox).
https://books.google.co.uk/books?id=C5-l28dcz50C&pg=PA186&lp...
(if the link doesn't work, search for NNTP Lotus Notes)