The Humument is one of the most famous of these types of projects -- "The Human Document," a 19th century novel, changed by art into the Humument and published in altered form in 1970. Today, altered books are a hobby art form with extensive internet presence. Michael's, a huge art department store, even has a description of the artform, and numerous how-to articles. A quick GIS can give you numerous examples of altered-book-artists' handiwork.
As an artform, collage has been around for a long time, becoming quite popular mid-20th century due to the enormous amount of published color pictures and documents -- anyone with scissors, glue, and magazines could produce new art without having to know how to move a paintbrush or operate a camera. The Altered book is a spur on the collage track: rather than starting with a formless pile of clipped photos and giving them order, an altered book starts with the orderly form of bound, printed matter -- a self-contained artform in itself, a closed system designed to exist entirely on its own. A book-alterer takes this art, and adds their own flourishes and alterations, changing the art of a single book into an entirely different piece of art altogether. The book, in general, remains intact, its pages remaining in their original order, with their words properly wrapping and breaking where they always have, but they take on new meaning with the alterations -- as in the case of the first link above, select words are deemed excessive, leaving behind the true art on the page. Others add their own illustrations, or give visual clues to the book's true content. And, unlike paintings, storage of these pieces of art has little changes from how the original artwork was stored: spine-out on a bookshelf.
On another 'altered-book' tangent -- Rebound Designs offers one-of-a-kind art pieces, made from the parts of books. The book-cover handbags are a beautiful re-use of the book, giving ladies the opportunity to show off their literary inclinations.