As well as institutions and asylums there was approved schools and reform schools, many many children who were disruptive or aggressive were sent to these schools, that disruptive or aggressive behaviour could well have been the result of undiagnosed sn such as high functioning autism, Asperger's syndrome, PDA, ADHD, SPD, dyslexia etc.
I can remember a few local kids that ended up in approved schools, borstal or prison and as recently as 3 years ago all were diagnosed with Asperger's and/or ADHD.
Having a child with SEN can lead to a long and difficult fight for a diagnosis and then its another fight to get an adequate education and if/when mainstream education fails it's another battle to get a suitable school placement, and then there is the annual struggle to keep that placement, sometimes these placements are many miles from home and are either residential or where daily travel can take up to 1.5 hours each way, it can and does break families both financially and emotionally. I know of one family who have remortgaged their house in order to pay the costs (in excess of£20,000) of taking their LEA to tribunal just for an adequate education for one of their children, I myself am dreading the possibility of having to do the same.
The internet has brought families with special needs children, siblings, friends etc closer together, it has made information easier to find and has helped families to familiarise themselves with the law surrounding special educational needs instead of it being hidden away as in the past. The system is still a long way from perfect and it is a long slow process.
Op I don't know whether SN's are on the increase, I've not had time to research that, I've been too busy working, raising a family and fighting the system.