Let me start by saying that Qi Gong is a newish term; originally the practice known by that name was Dao Yin. I rather like that name and would be tempted to use it here but that would get even more confusing! And the meaning of Qi Gong certainly fits: Working with or mastering the breath or energy of the body.
The exercises now known as Qi Gong were known in China as early as 3000 years ago. The story goes–as is true in many ancient cultures–that there was a great flood that came and destroyed much of civilization. After the flood, sages noticed that where the water pooled and stagnated, much disease followed but that in areas where the water ran freely, all of nature was much healthier: thus the idea that “flowing water never stagnates.” This idea was then applied to humans who are seen as simply microcosms of the universe. If flowing water is better, then flowing energy through the body must be as well and in order to flow, the body needs to move.
One early discovery was of 12 pieces of jade from 500 BCE whose inscription referred to circulating qi with the breath, getting it to rise and fall and move through the body to stimulate health. These exercises were soon became linked to the Five-Phases of Change or Five Element theory that was the basis for Traditional Chinese Medicine and references began appearing in many texts written by the Taoist philosophers.
One of the most fascinating finds was in 168 BCE when a silk scroll was found in the tomb of King Ma which depicted people of many walks of life, different ages, and both genders in positions from Qi Gong exercises. Under some of these there seem to be names of diseases or health problems indicating that these exercises were prescribed for those. Other figures had names of animals or birds underneath showing the link to nature that still guides Qi Gong today.