Paleontology (which it wouldn't be called until 1822) was a major passion of many of the founding fathers, Jefferson most famously. Scientists of the time lacked information on two fundamental aspects of natural history:

1. The age of the earth (it wasn't until the mid 1800s with Kelvin and Darwin that scientists began to really understand the scale of geologic history)
2. The concept of extinction

Prior to the work of Georges Cuvier in 1798, "naturalists assumed that other fossils had living counterparts of their own in some remote part of the world." As the American West was one of the few remaining territories unexplored by Europeans, many assumed that they would discover these living counterparts.

Slightly off topic, while Cuvier correctly deduced that fossils were mostly of extinct organisms, he theorized that this was the result of a 'cataclysm,' cleanly dividing the timeline of the earth into two time periods. Organisms that lived in the first time period became fossils, while organisms in the second (including the present) did not.

Finally, scientists have discovered living versions of animals previously assumed to be extinct (and only known about from fossils), such as the Coelacanth.

Further Reading:

• Georges Cuvier Zoologist: A study in the history of evolutionary thought

• Dalrymple, G. Brent (1994-02-01). The Age of the Earth

• Summary of Cuvier from Berkeley

• Coelacanth

• Living Fossils