From the JargonFile...

	 :	''Hacker's-eye introduction traditionally included in the top-level directory of a Unix source distribution, containing a pointer to more detailed documentation, credits, miscellaneous revision history, notes, etc. In the Mac and PC worlds, software is not usually distributed in source form, and the README is more likely to contain user-oriented material like last-minute documentation changes, error workarounds, and restrictions. When asked, hackers invariably relate the README convention to the famous scene in LewisCarroll's AlicesAdventuresInWonderland in which Alice confronts magic munchies labeled "Eat Me" and "Drink Me".''

	 :	''The file may be named README, or READ.ME, or rarely ReadMe or readme.txt or some other variant like README.md (default in GitHub). The all-upper-case spellings, however, are universal among Unix programmers. By ancient tradition, real source files have all-lowercase names and all-uppercase is reserved for metadata, comments, and graffiti. This is functional; because 'A' sorts before 'a' in ASCII, the README will appear in directory listings before any source file.''

AnswerMe: Does anyone here know anything about the history of this tradition, or recall when they saw it first?

I saw it with the proliferation of archived ShareWare on early BulletinBoardSystems. 

I second that.