There wasn't much tangible incentive for people to share. There was endless discussion about it, some pro, some con, but they never did add a leech filter. If you were concerned about the leeches, the best you could do was a reverse lookup on clients downloading from you and manually delete the ones who weren't sharing (enough to satisfy your sensibilities). The problem was the software was quite good at automatically restarting an interrupted download, so unless you had lots of people trying to download from you, the leech would be right back downloading again.

As far as why anyone shared, I'm sure the reasons are quite varied. Some people just wanted to make the whole thing work and realized that required some decent file sources. Some had delusions of altruism. I suspect most simply realized it was fair that they share at least what they'd downloaded from others.