> Why was the SBD supply increasing so fast last year when the prices were high? I was watching the supply go up super fast. I assumed it was the witnesses changing some settings to try and get SBD to go back to 1 by issuing more SBD's.

There were no witness setting changes whatsoever. A couple of witnesses did attempt to do so but all witness settings are subject to a vote (or median function in the case of price inputs) and it takes more than two witnesses to make any difference.

The high rate of supply growth was a function of the high price of STEEM (so large reward pool) coupled with SBD being overvalued. Normally (when SBD is priced about $1), there is a dynamic balance bewteen SBD being printed and SBD being destroyed by conversions. However, when SBD is way overvalued no sane person does conversions so the supply just builds up. 

> Also there are already stable coins that actually hold a peg out there like TrueUSD, why not just use those?

Those coins have counterparty risk and have 'features' which enable the custodian to freeze your coins. They also require using other blockchains with inferior scalability and the need to pay transaction fees in another coin (so if you want to buy some TUSD, you also have to buy ETH just to pay fees). The former is a different tradeoff (meaning there is room for both) and the latter is just a product with a much worse user experience.