Where does curriculum come from?

I'd like to begin by saying that in this post, I'm mostly reflecting on the nature of the English curriculum; however, I suppose the thought is applicable to all subjects.

I was just working on my plans for next year, going over my lesson plans for Oedipus. I'm not a huge fan of the play. In fact, I think it's over the head of most seniors, let alone freshmen. I taught it to both my levels of freshmen. They both read it. They both understood the storyline, but did they really understand the nuances? Not a chance. Try explaining the "paradox of blindness" to a bunch of 14 year-olds. They simply wanted to get to the part where Oedipus gouges his eyes out...and even that was overshadowed by the fact that he had slept with his mother. From what I saw, they didn't get a lot out of the play.
Possibly it could've been my teaching...I had no clue what to do with it, as I'm not big on it and that could've (most likely did) show through in my teaching and planning. Ultimately, we focused on the ideas of tragic hero, tragic flaw and catharsis. Then we tied those into Romeo and Juliet; however, I could've done that much more simply (and more quickly) with an overview.
I asked other teachers in my department why we teach Oedipus in its entirety, and ultimately it came back to the fact that it was in a former textbook. Now, that being said, it's no longer in the new textbook we have...and the department has had a heck of a time trying to find it (at least the translation they want). But it's still being taught.

The question that keeps bugging me is how much should a textbook dictate a curriculum?

The Oedipus thing is obviously somewhat extreme, as we don't even have the textbook anymore; however, I'm just trying to illustrate my point. I can just as easily give my students an example of tragic hero and tragic flaw using a more modern-day story...one they will be more likely to get something out of.
I don't want to dump all the classics by any means. I see the value of Shakespeare; besides the fact that he is the most referred-to author in literature, it has also been proven time and again that Shakespeare makes students' brains work and also improves their writing and vocabulary. (If you still are Shakespeare-shy, head over to Englicious to read more detailed reasons for reading Shakey.)
I simply want reasons for what I teach, and "that's how it's always been done because of a former book we used" is not a good reason. Give me objectives. The thing many people don't realize is that objectives can be met in a variety of ways using a variety of texts. If I suggested using something by Tennessee Williams to hammer home tragedy, while only touching on Oedipus, I think I'd be immediately kicked out of the department. But I also think the students would get more out of a Williams play.
Then again, there are some teachers in my department who would use the freedom to water down the curriculum...Make it easy on themselves, while also making it easy on their students. I suppose it somewhat boils down to professionalism...both on the part of the that's-the-way-it's-always-been-done'ers and also the I-don't-understand-it-so-I'll-dumb-it-down'ers.

I really haven't reached any conclusions. I don't know that there are any to reach.

Anyone have thoughts? Please share. I'm sort of at a loss on this one, I think.