My experience with backstory for PC's is that a big reason for a DM asking players to create backstory is that they have players who run appallingly one-dimensional characters. Every PC that every player creates is an orphan whose life to the point of beginning the game is uneventful and unimportant and now they are murderhobos. DM's then ask for players to create backstory as a means to get them to create characters who have SOMETHING to encourage a player to develop a personality for their PC's which they otherwise do not do. This effectively just highlights a disconnect between what the players want (or think they want) and what the DM wants out of the game. The players just want to get together, roll dice, and be murderhobos while the DM wants Great Drama, Moral Conundrums, and explorations of the Human Condition and Great Truths.

I've seen DM's ask for PC backstories OSTENSIBLY to be able to better weave the detailed lives of the PC's into the fabric of the campaign, but in reality they just use them to build a few adventures off of ideas written into backstories by the more creative players - that is, the DM lets players write a few adventure ideas so the DM won't have to. The fact that this will generally come at the expense of twisting and manipulating what the PLAYER was taking from the backstory is not considered. So, a PC who includes a long lost father as an element in his backstory just to give the character some emotion and concern regarding issues of fatherhood will find that the DM has chosen to make the BBEG of the campaign turn out to be the long-lost father the player mentioned. Whether the player MEANT for the DM to use and abuse the backstory they wrote in whatever way suited them, the DM nonetheless does use and abuse the backstory in whatever way suits them. Another reason why players dislike having to write backstory because they fear DM's who will only mess with it and make it something utterly different than what the player wanted it for.

I do encourage players to write backstory for their characters but I do not FORCE them to comply in any way, shape or form. Creation of backstory is FOR THEM, not me. If they are willing, or even DESIRE for me to incorporate their backstory directly into the game I'll do so - but by THEIR request, not mine.

I often enjoy creating backstory for my characters - but I keep it to myself. If a DM were to ask for a backstory I'd give them as harmless a backstory as I could devise to keep the DM from abusing it or perverting it to their own ends. Meanwhile, if _I_ wanted more then I'd create more, but would be unlikely to then reveal any of it to the DM if I had even the least suspicion they'd do anything to make me regret having done so.