Mikvah at Qumran
"Numerous mikvot (ritual purity baths) were in use at the site for this community that practiced immersion twice daily.
This mikvah evidences the site's destruction by earthquake in 31 B.C. The crack shifted the left side of the mikvah by nearly 12 inches."
http://www.bibleplaces.com/qumran.htm
Evidently ritual bathing was practiced in the 1st century BCE by the Essenes, so the baptisms instituted by John were not especially novel.
As to why Jesus was baptized by John, on the face of it I'd have to conclude that John was the more established apocalyptic preacher/prophet at the time, and Jesus sought him out for the purpose of getting baptized and joining his movement, or allying himself with John. The John-Jesus relationship shows several indications of deference, as when Jesus sends word to John in prison to compare his miracles with those on Isaiah.
Of course the baptism of Jesus created a sort of theological Gordian knot for later Christians-- the story was well-known and could not be gotten rid of, so it had to be shaped to fit evolving theological necessity of showing Jesus to be the Son of God. Even as this was done, the story was used by Jewish Christian Adoptionists to show that on the occasion of his baptism, God "adopted", "came into" Jesus. And subsequently left at the crucifixtion. Something like this might have been the view of the Christian community under James, which was opposed by Paul.
For more on this see Prof Bart Ehrman's very readable books "Lost Christianities" and "Orthodox Corruption of Scripture."
Here is a brief summary:
http://www.trends.ca/~yuku/bbl/8ado.htm