My grandmother was a very pious woman. She came from a long line of rabbinical leaders. Never once have I ever heard her use the term "Hashem" in referring to G-d. For the last several years, I’ve been hearing "Hashem" all over the place. Did I miss something, or is this something new?
The notion of not using the proper name of G-d (A-do-nai) in speach is already alluded to in the Mishna. Other names (E-lo-him etc.) are generally not used by Ashkenazim in speech, though Sephardim do so. Many religious Sephardim used the actual name of G-d, though not in vain, i.e. when actually referring to G-d, as in may A-do-nai bless you, as this is like a prayer. Ashkenazim traditionally refrained from using the explicit Name even in such a case. Today, many people do not even say G-d's name in Zemirot of Shabbat. I believe this is a serious mistake.