I am a bit puzzled by this: "Before about the early 90s, we didn’t trust C compilers, so we wrote in assembly." There a lot of games released during the 80's, were they really all written in assembly ? https://www.myabandonware.com/browse/year/ I don't have experience in the game industry at all, I must add.
Slower-moving adventure and RPG games might be in a higher-level language. (IIRC the original Wizardry was written in a VM-based Pascal for Apple II?)
Companies that specialized in adventure games would have their own interpreter and VM — Infocom's ZIL, Sierra's AGI, Lucasfilm's SCUMM. Game developers would write code in a scripting language against that company-standard VM.
Amateur games might be written in BASIC because every computer under the sun shipped with a BASIC interpreter back then.
C wasn't a practical option because decent compilers didn't exist for most non-Unix systems until the end of the 1980s — or if they did, they'd cost an arm and a leg. (I think the retail price for Microsoft's C compiler for DOS was several thousand dollars.)