Marty is definitely correct about the origin of the terminology in the study of homogeneous spaces $G/H$ of reductive Lie groups.   Due to the special example involving a quotient of special orthogonal groups the handy term *spherical" got attached to the subgroup $H$ or the homogeneous space.   In turn, this was carried over to the situation of algebraic groups and similar quotients in the algebraically closed case, where spherical varieties could be characterized as those homogeneous spaces admitting a  dense orbit under a Borel subgroup.   For instance, an influential paper by Brion-Luna-Vust appeared in *Inventiones* 84 (1986) with the title *Espaces homogènes sphériques*.   While the label *spherical variety* is convenient, it loses its literal sense in this generality.