The odds are very unlikely, however it is actually possible, that if the gun was dropped just right, that the firing pin would strike from inertia, thus firing the chambered round while the thumb-safety locked the slide in place keeping the shell from ejecting.
If that happened, maybe it caused a world of trouble, regret, or even simple lack of trust in the gun for whoever owned it at the time, thus it was tossed/gotten rid of (though I think trouble would explain why the shell was still in there, as they would have cleared the weapon if they didn't have more pressing matters?). This doesn't explain the condition of the magazine like the 'fire theory', but maybe as the mag is thinner steel than the gun itself, the elements merely took their toll...
This is all very theoretical. I am not saying this is what happened, just that it is possible.
edit: Also, Hey Sharps, when you first acquired the gun, was there any evidence of grip panels, or any information about them?