You may be surprised to discover that the use of the word cool as a stylish ‘term of approval’ can be dated back to 1948 (see senses 4d and e of the adjective). The term was born into the Jazz world and is defined by the OED in relation to music as ‘restrained or relaxed in style’. The earliest citation given by the OED refers to the famous Jazz saxophonist and composer Charlie Parker.
Cool later became embedded in the everyday vocabulary of a younger American culture, and was applied generally to ‘those who favour ‘cool’ music' or were 'relaxed' and 'unemotional’. The first citation of the word in this sense is from a 1948 edition of the New Yorker magazine. One imagines an older, rather gangly and awkward journalist standing at the back of a trendy party and writing the line ‘The bebop people have a language of their own... Their expressions of approval include ‘cool’!’
Terms for ‘good’, ‘bad’ and ‘very’ are subject to rapid change, as each generation and subculture is date-stamped by its own very special words. In this culture of linguistic re-cycling, cool has kept bubbling on. The widespread recent spelling of cool as kewl in text messaging is not yet recorded as one of the spelling forms.
It is also fascinating to see that cool has been used to describe those ‘not heated by passion or emotion...undisturbed, calm’ for over a 1000 years, – the word stretches right back to Beowulf. In this sense however, the word applies less to popular style, than stiff upper lips, calculated behaviour, and perhaps arrogance.