1. When did drama replace storytelling as the most popular form of public entertainment?

Do you mean this historically, or are you referring to a specific passage from the play? In terms of the former, it might be a mistake to consider drama not to be "storytelling," though it is distinct in that it posits characters who confront one another rather than one person confronting an audience directly with a tale. The earliest record we have of drama as overarching entertainment is with the Greeks. While theatre (drama) waxed and waned over the ages, by the time that Everyman was crafted, it had been around and functioning as entertainment for a long time.