How did novelists manage without the word processor?
A minor character starts to develop into a recognizable human being, becoming a powerful mover and shaker, but he entered it small and insignificant several chapters back. 
So you do a search on his name from the beginning of the document and flesh him out, making him more real in your own mind as you go. You might even change his name.
Or if, like me, you form the basic story from intertwining threads, completing one at a time, then each thread is a pass through the whole document. Often a new thread has an effect on one you’ve already written, making it stronger and more consistent.
And again, once the characters, the threads, the fleshed out skeleton is there, there are several passes through: settings expanded and made more colourful; character’s physical movements described so they aren’t just talking heads; emotion, especially reaction to other characters made more explicit; better description of places using all the five senses. You might find you need to include some back story to explain why they act as they do, and it might be necessary to include a flash back, in which case where do you put it?
How on earth could you manage this with a typewritten draft?
I read recently that Jilly Cooper still uses a typewriter, managing cut and paste with actual scissors and glue. But this would only be possible if your first draft greatly resembled the final version. There would be more glue than paper if I were to do that.
Then again, one hears that double spacing the manuscript gave room to write in changes and extra paragraphs. Again, this would only allow for minor fleshing out, though I guess you could add extra pages and paperclip on the odd few sentences. It wouldn’t give you any more freedom than Jilly Cooper’s solution.
So I have to conclude that they didn’t write them the way I do. Perhaps the method I have evolved – and I am not unique, I find – is a recent invention. Since it is now possible to do stories in multiple overwritten layers, writers have arisen who can only work that way.