The original Cup was like the top section of the current trophy, a silver bowl from Sheffield, England purchased in 1892 for 10 guineas on behalf of Lord Stanley of Preston, Governor General of Canada. It is the oldest championship trophy in professional North American sports. The original bowl is now retired, and a replica adorns the current Cup.
The informal tradition of players adding their names to the trophy became formalized, and the bands were added to hold the names. In a unique tradition started by the New York Rangers in 1994, each player also gets to have the cup for a twenty-four hours, to take home to the folks or otherwise spend time with*.
So ... how did Lord Stanley's mug end up in the bottom of Mario's pool?
After the Pittsburgh Penguins' first Cup win in 1991/1992, the team was invited
back to Mario's palatial home to celebrate. The house featured an in-ground
swimming pool. The pool's decorative highlight was a four-tier neon-lit
waterfall.
During the course of the party, Penguins goaltender Tom Barrasso climbed up the
waterfall with the Cup, and had his photo taken. After much more of this, the Cup was left atop the waterfall and the party went on.
Meanwhile, defenceman Phil Bourque, who had been enjoying a frosty alcoholic beverage or two, decided to scale the waterfall. According to legend, clad only in his underwear, Bourque lifted the Cup and hurled it into the pool, where it sank ignominiously to the bottom.
Since that infamous day, the Cup travels with security escorts assigned by the NHL.
Fun fact: The Cup holds exactly seventeen cans of beer.
* Many have debated what should happen to the Cup during the 2004 NHL player lockout summer. The league has hit upon a tremendous idea. Since 1994, each player on the winning team has gotten to spend one day as he chooses with the Cup. During the summer of 2005, the NHL will honour select veterans from the past by letting them have the Stanely Cup for a day. According to TSN columnist Bob McKenzie*, the oldest living Stanley Cup winners will be given the Cup for a day. Bob reports that HHOF member Ted Lindsay spearheaded this effort.
http://www.tsn.ca/columnists/bob_mckenzie.asp