Ok ,I can only research this on retail and i am not sure whats changed.
You can rep farm for your home city and drop the mount riding training cost by 50% to 40g. grab every quest you see in town and do them and I guess if you are undead , do the chains through silver pine and tarren mills etc to get forsaken rep.
The first decent sized bags in retail seem to be on a NPC named Uthok in Gromgol ( which you can take the zep to from UC) , not Stonetalon like I thought. I do not know if he exists in classic, but he sells 10 slot bags for 1.65g and 12 slots for 8g if for some reason you cant buy silk bags in the ah cheap
If you are poor, kill the Horses in Shadowfang keep, they usually drop somebody a saddle bag almost every run and at level 30 , I think you can still queue it , if not blast your way through it solo as a warlock.
When you get higher backpacks drop in Stratholme sometimes, but by then you will have a ground mount anyway.
Larger bags means you can loot reagents and sell them on the AH for mount money. I made more money on classic selling mats than making greens
Hope this helps