Wikipedia has an article on dictionaries, and it says:
The first purely English alphabetical dictionary was A Table Alphabeticall, written by English schoolteacher Robert Cawdrey in 1604. [...] Yet this early effort, as well as the many imitators which followed it, was seen as unreliable and nowhere near definitive. [...] It was not until Samuel Johnson's A Dictionary of the English Language (1755) that a truly noteworthy, reliable English Dictionary was deemed to have been produced, and the fact that today many people still mistakenly believe Johnson to have written the first English Dictionary is a testimony to this legacy.
How did he choose the words? By studying, and by being well equipped. English wasn't spoken widely anywhere but in England at the time of the earliest English dictionary, so Johnson would have gotten sufficient knowledge to make a dictionary just by studying his own country; and Johnson was described "arguably the most distinguished man of letters in English history".
Secondly, Johnson's (or Webster's) dictionary would not have been regarded as reliable unless authorities and laymen alike approved of its comprehensiveness. It would not have been approved of if it had missed anything anyone deemed important. Though there were undoubtedly words which were not in the dictionary, the missed words would have been mostly slang. The dictionary was not so authoritative as to discourage use of the inadvertently excluded words. Even now, it doesn't stop people from using an already established word just because they don't find it in a dictionary.
In 1807 Webster began compiling an expanded and fully comprehensive dictionary, An American Dictionary of the English Language; it took twenty-seven years to complete. To evaluate the etymology of words, Webster learned twenty-six languages ...
His book contained seventy thousand words, of which twelve thousand had never appeared in a published dictionary before.
In twenty-seven years, a scholar such as Webster could not have missed anything important. Building on others' attempts and his previous edition, he had ample resources to come up with an exhaustive list.