The important thing to remember is that, while the Greeks of Homer's time were aware of a vague sense of shared Greekness, Ancient Greece was not a nation-state. The Greeks lived in a collection of scattered autonomous communities. By our best estimates, there may have been as many as 1300 individual Greek states, most of which would have had no more than a few thousand inhabitants. The citizens of each state would have their own shared traditions, cults, institutions, and stories. While many of these aspects of culture would be recognisable to other Greeks, they wouldn't be the same; and only the learned or well-traveled would have more than a passing familiarity with the traditions of other states.

It's therefore not very likely that any single Greek recognised or knew about all of the heroes and places mentioned in the Iliad, except by hearing or reading the Iliad. The point was not to create a canon of characters that every Greek would know and love. You'll have noticed that many of the heroes are mentioned only once, often at the point of their death at the hands of another hero. The vast majority of states and leaders are quickly introduced in the massive section of Book 2 known as the Catalogue of Ships, or in the corresponding catalogue of Trojans and their allies. Many of these are only seen again once, or not at all. While some of them might have their own stories and legends connected to them, most people would see them only as names, representatives of distant places that were remote and unfamiliar, but that did count as Greek. It might have been fascinating for listeners to learn about all these places, famous for their black earth or flocks of sheep or flights of birds - but most Greeks would be far more keen to get to the lines describing their own local towns and heroes.

And this is the key reason why the Iliad mentions so many names. It's not because all of these names would mean something to all Greek listeners; it's because every single one of these names would mean the world to some of its audience. The epic started as an oral tradition; it was sung by rhapsodes at the festivals of different Greek towns. It needed to connect with each audience, and the best way to do this was to mention them all by name.

Later Greek literature shows that every community that was mentioned in the Iliad took pride in this fact, and flaunted it wherever possible. It was proof of their ancient connection to the idea of "the Greeks", and their participation in the greatest story ever told. Any community listed in the Catalogue could say, "look, we were there." The fundamental importance of Homer's epics to all Greek education helped to solidify this sense that mention in the Iliad was the true mark of an Old Greek people who counted. Indeed, whatever Homer happened to say about a particular person became a point of pride for that hero's people; the Athenians of the Classical period still claimed great skill at deploying troops for battle, simply because Homer said that the Athenian Menestheus was better at this than any other Greek hero except Nestor.

These later references and their apparent weight have convinced modern scholars that the inclusion of masses of names in the Iliad was a deliberate attempt to make the story relevant to as many Greek communities as possible. Either the poem developed this way in order to appeal to different audiences, or it was adapted each time and the added names stuck; before the "canon" version of the Iliad was written down, rhapsodes probably focused their name-dropping much more on the specific community they were singing to, adding local heroes and leaving out ones that would get no reaction. The success of the epics as these malleable, all-embracing stories made them in some sense a foundational charter of Greekness, a benchmark for inclusion or exclusion, and a central text from which all other mythical and literary traditions spun off. It's not surprising that later authors considered Homer, not merely a poet, but a historian - one who did the essential job of recording who was there, at the beginning of historical time, when the Greeks first got together to act as one.

 

I feel robbed not getting the Trojan Horse in the story; had no idea it wasn't part of the original telling.

The Trojan Horse absolutely was part of the Trojan War Cycle at the time the epics took their currently known form. We know this because the story is mentioned in the Odyssey.

The problem is that our modern understanding of the Trojan War Cycle includes the whole story - from the wedding of Thetis and the Judgment of Paris right down to the homecoming of Odysseus. We can tell from remarks and references in Homer's epics that this whole story already existed and was known to the poet. However, he does not attempt to recount the whole thing. He only covers episodes from it.

In our modern perception, "the Iliad" and "the story of the Trojan War" are practically synonymous. But they are not; the Iliad only recounts the events of about 15 days during the 10th year of the war. At the beginning, the Greeks are already besieging Troy, and at the end, Troy remains unconquered. The poem clearly announces what episode of the Cycle it covers: "the wrath of Achilles that brought countless evils upon the Achaians". It spends little time on why the war began, what happened in its first 9 years, or what will happen when Troy falls. We know the rest from other poems and summaries of those poems, many of which date to much later periods. This doesn't mean that things like the Trojan Horse weren't part of the "original telling" - only that it wasn't part of the bit of the Cycle that Homer is telling you.