No doubt that was by design. The WB and UPN (where I worked) had very small audiences, and those that watched weren't exactly habitual in the early days. The thinking among most network execs is the episodes had to be self-contained, for the most part, of viewers who might get a chance to check the show out would be lost. They realized their viewers weren't necessarily coming back week-after-week, and probably watched when their usual show was preempted or in a rerun. Also, at that time, many WB affiliates were also FOX affiliates, so they broadcast the WB shows at off hours (like weekend afternoons and such) and they weren't exactly regular and predictable (often being preempted by sports and such).
Buffy attracted a relatively large audience and earned the luxury to do longer arcs. It also was at the time when The WB finally made real progress at getting better affiliates and better broadcast times for their shows in many markets. We had a great show (Nowhere Man) at UPN that never really caught on, as the producers didn't really stick to single-show arcs. Also the Net Execs and the Exec Producer (a real ass) got into pissing contests and proceeded to harm the quality of the show. Check out the pilot and early episodes if you ever get a chance.
http://www.amazon.com/Nowhere-Man-Complete...d/dp/B000BC8SXS