They were also more expensive than regular binders and the rings weren't lined up with regular folders, so being in the Trapper Keeper ecosystem was a class symbol in my school.
https://www.youtube.com/watch?v=_jSPNoA40jg
https://www.youtube.com/watch?v=J5czEGnl2Wo
https://en.wikipedia.org/wiki/Trapper_Keeper_(South_Park)
>... the Trapper Keeper binder is destined to gain sentience and hybridize into a supercomputer to conquer the world in the future, and wipe out all traces of humanity ...
The locking cover was like the belt and suspenders and served to show off the style of the owner.
It was ultimately a way of selling more paper. It was hugely successful and is the reason 3-hole punches and 3-ring binders exist today.
So far as customization - the thing we'd do with textbooks is cover them in paper grocery bag material so you'd have something to draw on, as well as protect the book so you wouldn't be charged when you returned it.