Since this is a multi-part question, I'll break it down into smaller chunks.

First, a quick history of lobotomy. It first began as something much, much more brutal. The inventor of psychosurgery, Egas Moniz, started out with an idea stolen from someone else, something much more barbaric than a lobotomy. He started out by removing patients' entire frontal lobes (the point of lobotomy was to sever connections between the frontal lobe and the rest of the brain, not to take chunks of the brain out). His colleague was doing it with non-human primates (chimps), but Moniz had handy backdoor access to actual asylum patients to practice on, so he took some patients and invented the frontal lobectomy, completely removing patients' frontal lobes. That did . . . not go well. It's heartbreaking. So he developed a less drastic approach. It's called a prefrontal leucotomy and he won a Nobel Prize. Psychosurgery crossed the Atlantic, where it was picked up by American doctors, most notably the psychiatrist Dr. Walter Freeman and his partner, neurosurgeon James Watts. Together they frequently performed prefrontal leucotomies, authored a book on psychosurgery (I actually own a copy), and trained other doctors. Dr. Freeman turned the procedure into what's known as a transorbital lobotomy and the rest is history.

So, when did doctors realize that psychosurgery was cruel and barbaric? Immediately. When Dr. Moniz first introduced the leucotomy procedure at a conference in 1936 it was received with hostility and denouncement by his colleagues. He had almost no research and had more or less experimented on humans, for which he was roundly condemned, and his results were immediately questioned. The asylum doctor who provided patients for the surgery was present at the meeting and flatly challenged Moniz's results, saying that when the patients came back to the hospital, they were worse, not better. Moniz had no long-term results - he typically observed his patients for just a few days and then sent them back to the hospital and never saw them again. In the aftermath of the conference, the asylum doctor who gave Moniz access to patients stopped working with him.

Even stateside, it was a divisive subject. Some hospitals saw it as a desperately needed treatment for their patients. Other hospitals banned it outright - including the hospital Freeman and Watts were affiliated with, St. Elizabeths Hospital in Washington DC. They had to perform it at other hospitals or in their private offices.

Freeman refined the technique when he started performing transorbital lobotomies. Lobotomies were extremely appealing to many hospitals. You didn't need an operating room, you didn't need a neurosurgeon, it did not take a long time, and it's a surprisingly simple procedure. All you had postoperatively was black eyes. Freeman drove around the country teaching doctors - and sometimes non-doctors - the surgical technique. Freeman's car and camper were called the Lobotomobile. (I am not kidding.)

But in addition to the doctors who were horrified immediately, doctors and hospitals who had performed leucotomies/lobotomies were finding that not everything went well. Some patients stabilized, and some got worse. And while this was going on, Freeman was selling this idea to anyone who listened including (insert dramatic noise here)- the general public. That was a HUGE no-no at the time. You went to your doctor, he gave you treatment, the end. You did not ask the doctor questions. You might not ever know your diagnosis. Doctors were gods. And thanks to several articles published in the biggest magazines and newspapers at the time, patients were coming to doctors and asking for the procedure. Dr. Freeman pulled back the curtain to the general public. He really upset the applecart by doing this, and it contributed to the objections of doctors already concerned about the procedure.

But as upset as people were, there weren't any other options. So lobotomies continued. Until one day, when there became options. In 1952, researchers discovered that a surgical anesthetic called Thorazine had psychoactive effects. If you gave it to patients suffering from psychosis, they got better. It was even called a "chemical lobotomy" when it was first introduced. It worked better, cost less, and didn't require making permanent changes to patients' brains. And that's when the medical community really overtly started rejecting the whole idea of lobotomy/psychosurgery. New antipsychotics were being developed at breakneck speed, and as much as Dr. Freeman and his Lobotomobile soldiered on, the surgery finally became viewed as barbaric. By 1960, even Dr. Freeman was infrequently performing the surgery, and 1967 saw the very last lobotomy Dr. Freeman ever performed. Once hailed as a miracle by doctors and the general public, it was eventually abandoned.

We don't have a lot of data on the reactions of the families of patients who had lobotomies. This was not a time when doctors needed consent. Most families knew little, some never knew at all. If the patient didn't go home after the procedure, there was a good chance the family might never know they'd had the surgery. Remember - in the beginning, doctors were gods. Families were not informed of treatment decisions. If it didn't go well, families might never know. Even when they did, they generally accepted it. The doctor said your relative needed a special surgery, and it happened. It didn't help, or made things worse? Medical malpractice law was in its infancy.

The best example we have of family reaction comes from the Kennedy family, and this information was not public knowledge until a few years ago, over a decade after was doing my research. Rosemary Kennedy was JFK's sister. She had a birth injury and due to lack of oxygen, she suffered brain damage, causing her to be intellectually and developmentally delayed. Freeman and Watts took her on as a patient, saying (and genuinely believing) that a leucotomy would help. But they cut too deep, and she became one or two steps above a vegetative coma. The family reaction was to sweep it under the rug, but everyone was heartbroken and some people were really mad. It was part of the reason JFK started closing mental hospitals and the entire reason Rosemary's closest sibling, Eunice, created the Special Olympics.

The other barrier to knowing what patients' families thought is that there was so much taboo associated with ANY psychological disorder. You did not tell people your relative was in a mental hospital, much less that they had brain surgery to cure mental illness.

Were lobotomies used maliciously? Probably, but again, there's not a lot of information that talks about it. People who do malicious things are not keen on documenting what they did, and when hospital after hospital was closed and became abandoned, we lost very valuable source material. I'm sure lobotomy was used as a threat - "if you don't do X, we'll take you to the doctor to get surgery". But these kinds of things don't end up in the records. And they didn't require consent. Thousands and thousands of people had brain surgery without consent. It's horrifying to us but was standard back then.

I think I covered all of your questions, but if you have more, or I wasn't clear on something, let me know.

Hi! You might be interested in this discussion by /u/hillsonghoods in a followup to a question about Rosemary Kennedy.