In the beginning, Dartmouth created the AI and the hype

If one wanted to write an interesting counterfactual story it could be about how the 1956 conference succeeded beyond anyone's wildest dreams but before they implemented the theory they realized UFAI would destroy them all (or maybe the limited hardware of the day didn't allow for a hard takeoff and they managed to stop it; more dramatic!) and they had to plan a vast conspiracy to bury the results and lead other researchers down blind alleys for decades. These were many of the best minds in the field, after all, and they had the hindsight of Einstein and atomic energy.

And, perhaps unsurprisingly, about as little concern about the impacts of AGI as concern in the ability of a few grad students to crack vision over the summer.

Interesting note: by the time the conference was taking place, Goedel already had articulated the correct approach to item 4 in his letter to Von Neumann (http://rjlipton.wordpress.com/the-gdel-letter/).

An entire field of statistics, dealing with uncertainty, and learning from data was already in existence for two hundred years. This field already knew logic was hopeless for addressing the complexities of the real world. Physicists had already invented primitive graphical models by then (http://en.wikipedia.org/wiki/Ising_model), a working theory of "neural nets" already existed in the guise of theory of non-linear regression (http://www.tinbergen.nl/discussionpapers/02119.pdf), etc.

The lesson seems to me to be this: big gains lurk in having the humility to engage in comprehensive scholarship and integration of existing advances. Being widely read, and speaking and translating many specialized languages.

What did people really have in mind as a "significant advance" though?

And remember that they had had great success in teaching computers to perform what had previously been seen as highly skilled tasks - mental arithmetic and calculating the values of advanced functions.

low paid labourers

The jobs were relatively high status (especially for women).

They were at the beginning of the field and didn't know how to make the computer do much of anything. They were focusing on abstraction and language and were optimistic on accomplishing things in there; they would probably have seen `acting like a cat' as a strictly easier problem that they hadn't had the time or interest to work on.

It should be more troubling is if it looks like they were grappling with the right issues.

With regards to the Moravec's paradox, if you can't see how your AI idea will replicate behaviour of a cat (provided you have a cat), your notion of 'general intelligence' is probably thoroughly confused. If your AI needs to do something very superhuman to survive as a cat in the wild, likewise so. The next step could be invention of a stone tied to a stick, from scratch. If you think of AI doing advanced superhuman technology, your standard of understanding is too low.