I think there are two different issues here which you eliding by labeling this as "settled back in 1996." What I would say was "settled in 1996" was the fact that cookies are a useful technical measure to enable websites to save state, and users wanted features like login persistence across browser sessions, etc.

I don't think that "unlimited user tracking by advertising networks, regardless of good-faith user efforts to limit data tracking" was at all part of any tacit agreements reached by the internet community. The principle that communication networks should be transparent in how they operate, and allow users of the network to meaningfully control their interactions with them is a meta-principle that is pretty clearly implicit in the design of the internet, and I don't think the current widespread use of tracking technologies and data analysis without informed user consent is consistent with those principles.