There is an episode in the Chhandogya Upanishad. Narada tells Sanatkumara: I have knowledge of all that constitutes apara vidya. But I have heard that it is only the highest knowledge, para vidya, that can vanquish sorrow. I grieve, I feel sorrowful. Lead me, Sir, I pray, to that shore that lies beyond sorrow.
According to the Mundakopanishad, apara vidya (which Narada says he has mastered) comprises the four Veda-s, the six Vedanga-s which include grammar, metrics and astronomy), and all other subjects of study that number more than a score. These include the science of living beings (bhuta-vidya, which incidentally can also mean knowledge of as many as fifty other things into which bhuta translates, including ghosts, the five elements and all of existence, or all that is!) and itihasa and purana.
Itihasa and purana have been interpreted by modern scholars to mean myths. Earlier scholars made significant distinctions in this broad categorization. Patanjali (historically dated to ~ 4 CE) makes a distinction between historical stories (aakhyaana-s) and works of fiction (aakhyaayika-s). Around a thousand years earlier, Panini (historically dated to 4 BCE), talked of four classes of literature, which included Upajana or original works not handed down by tradition, and compositions of a general nature on a miscellany of subjects. Patanjali classifies the aakhyaayika-s under the last category.
We know so little even of what the ancient-most Indians knew – in terms not only of that knowledge per se, but knowledge about that knowledge – that we can hardly claim to take a considered position on what is myth and what is fact. It is but futile to attempt a substantive argument when the fringe is all we have exposure to. Merely denying the existence of something when you do not even know the extent of what it is that you are trying to reject is an absurd position to take.