Ornamentation such as you describe was undoubtedly common practice during the baroque period and even later (Robert Levin's lectures on Mozart and improvisation, available on Youtube, are highly enlightening, see here).
The degree to which one adds non-written ornaments (either on repeats or at other places in the piece where they might be needed) depends on various factors. Some pieces, for example, already have highly ornamented musical lines and adding more would be simply too much. One criticism levelled at Bach (examples abound, both in vocal - for ex. the duets in BWV 140; notice both the highly ornamented violin line and the notated vocal ornaments - and instrumental works) by Johann Scheibe, a contemporary critic, was that he did just that, leaving little place for creativity (cf. Barber, 1971, amongst many sources on the topic).
Other factors include the performer's technical ability and experience with such improvisation, and, most importantly, what feels musically appropriate (one could term this "good taste") at the particular point in the piece. As Levin says, the purpose of decoration is "to deepen to expression of the piece, not to show off your finger virtuosity". What constitutes "good taste" at any given point, of course, is a matter for personal interpretation by the performer, and in any case, is where the crux of the matter probably lies. Add to that geographical differences in music interpretation (back in the baroque period and even nowadays), and you have a perfect recipe for exactly the kind of difference you mention in your question.
