As referenced above, the methods of measuring a pitcher's velocity have changed over the decades. Bob Feller's fastball was once clocked at 98.6 mph by the US Army in 1946, but it was measured not as it left the pitcher's hand, but when it crossed the plate. Using today's technology, Feller's fastball would clock somewhere between 101 and 107 mph at the point of release.
I think what's also overlooked is modern training and baseball (as with all major sports) becoming a year-round job. Guys in previous generations didn't have the luxury of keeping up with their conditioning in the offseason; in almost all cases, they had to work other jobs to make ends meet and so their conditioning most likely suffered somewhat.
A previous poster referenced "Sudden" Sam McDowell, who in 1965 made his first All-Star team and led the American League in ERA. In that decade, the average player size was some 20 pounds lighter than contemporary players. McDowell himself weighed around 190, which made him 17 pounds lighter than the average weight of a player today. Yet, he still managed to strike out 10.7 batters per nine innings and logged a total 273 innings that season. (For the record, no major league pitcher has logged as many as 250 innings since Justin Verlander in 2011.) As late as 2011, McDowell ranked ninth on the all-time k/9 IP list at 8.86. Now, he's 32nd.
I think the other factor is that pitchers of earlier eras typically went the full nine innings, or at least close to it. Complete games at one time were commonplace; now if a guy pitches one he practically gets a parade in his honor. Even the hardest throwers back then had to pace themselves somewhat; they couldn't just cut loose with pure gas for an entire game because they had nine innings to cover. Teams now are obsessed with guys who can throw blink-and-it's-by-you fastballs, so you'll naturally see more of those types of pitchers. Being able to throw 100 mph today in baseball is sort of like measuring 7-4 in basketball; some team will always be willing to give you a look because those two attributes can't be taught.