Early console games either used a password based saving system or none at all. Later on, certain games (Final Fantasy for example) had a small battery, allowing game data to be saved aboard the cartridge’s RAM. Save points were used because at the time, it wasn’t possible to allow on-the-fly saving on most console games because of the game state being too complex or large for the game’s memory/card/whatever. This mechanic is a perfect example of something created through technological limitation, carrying through games today.
It really though, depends on the game’s design and how the save points are used. Not all save point based games are bad. Shadow of the Colossus for example has save points that are hard to find, but it doesn’t matter because it isn’t a character progression or a grind based game (if you can’t find one nothing is really lost). It also automatically asks you to save after downing each colossus; Should you lose a colossus battle, you will be reloaded ot the start of the fight.
The Metal Gear Solid series uses a zone based saving system. You are permitted to save at any point, but the game will reload your progress to the beginning of whatever area you are in. You will lose any weapons that you have acquired and any progress made, but the zones are small enough so that it does not matter much.
Final Fantasy XII on the other hand has huge dungeons and zones with very few save points. The lack of save points is frustrated because it’s a grind based game that artificially increases it’s difficulty by forcing you to level grind in areas with very few saves. Grinding for a while and not being able to save sucks.
Ideally, I like being able to save anywhere at will (quicksaves <3). At minimum, I would like the ability to save upon entering a new zone. Additionally, when a boss fight is lost, it’s nice when a game automatically loads to the start of the fight, so that time isn’t lost repeatedly having to run back and reshuffle spells.
It might be my style of gameplay though: I like creepsaving, partially out of paranoia that the power will go out or a situation will arouse in which I will have to leave. Also because I like to experiment. It’s nice being able to quicksave before I punch a guard in the face to see what happens.
I don’t ask that all games allow on-the-fly saving, just they the difficulty level isn’t artificially increased by reducing where you are allowed to save. There are many many ways to punish a player, but I don’t like being punished by losing an hour of progress for having to attend to real life.