So obviously, it might seem like this question is better suited for r/askphilosophy, but since q's there have to be distinctly philosophical, and what I'm asking is definitely more of a historical account than a call for opinion, I figure I'd ask it here.
I'm researching the history of Thales, the man credited with being the "first philosopher," and namely his concept that all things have a principle substance (an 'arche') which he believed was water. However, I cannot seem to find any direct account of this being his belief other than a mention in a work of Aristotle, who was born 200 years after Thales died.
What I'm wondering is, are there any more sources besides Aristotle claiming that he said this? Such as someone who lived earlier than him, who may have a more direct account? And if not, how reliable can Aristotle generally be considered as a historian when it comes to the classical era? I am pretty sure that this is not the only time he is cited as a primary source on a historical account, so is he seen as someone who cared about the truth and can be believed? or rather someone who enjoyed giving interesting yet false narratives for the sake of poetic interest? I would not think him to be someone who dedicated himself to history, but when it came to the history of philosophy, which was still new and fresh at the time, he might have taken a more disciplined and focused approach
I trust you are referring to Aristotle's Metaphysics 983b for the source on water as a 'principal substance': it's best to check, because there is another bit that mentions Thales in connection with water, at On the sky 294a-b, where he says that Thales supposedly taught that the earth stayed in place by floating, as if on water. A slightly different version appears in a later source, Seneca, Questions on nature 3.14.1, where we're told that according to Thales the earth actually does float on water.
We don't have as much in the way of older sources as you may imagine. No piece of writing from any of the Milesian philosophers survives. The only important source before Aristotle is Herodotus (there's a passing mention in Plato), but Herodotus is telling a story, not summarising a philosophy: his picture of Thales focuses on ethics and politics, plus one astronomical anecdote. With ancient writers whose works are lost, we always rely on later testimony, often a millennium later than their lifetimes, because there just isn't anything else.
The Metaphysics passage is the only source that talks about Thales' teaching on a principal substance, or material principle. And it's clear that Aristotle's own information was indirect. Thales certainly didn't leave any written works: no ancient source ever says they had read anything by him, and books just weren't written down in Thales' lifetime. The most likely scenario is that teachings associated with him were known via the writings of later Milesian philosophers, probably Anaximander or Anaximenes.
The idea of all matter being a single substance in myriad forms was a widespread one, however. Water has the particular advantage that it can trivially be observed in three states; water is extremely important in Near Eastern mythological cosmologies, and the idea of the earth floating on water also appears in Egypt, which Thales was reputed to have visited. A hint of the idea appears in Homer, Iliad 14, which refers to the river Oceanus (which surrounds the earth) as the origin of all things.
But obviously other substances needed their own explanations, so philosophers came up with varying solutions. Anaximenes thought air was the primal substance. Heracleitus didn't pick a favourite but did think they could all change into each other. And of course later on Leucippus and Democritus came up with atoms, and Empedocles came up with a canon of four elements. As for Aristotle himself, he opposed the atomists, but he also regarded the four element model as emerging from various properties (hot/cold, dry/wet) being applied to a single substance that he called 'wood' (hylē). What he says about Thales has to be interpreted in that light: Aristotle was thinking in terms of fundamental substances, but it may be that that isn't what Thales was thinking about. He may have been thinking more about water as the origin of all things in mythology -- along the lines of Tiamat and Abzu, or the primordial tehom in Genesis 1.1.
The most straightforward place to look for discussion of Thales' teaching on water is probably Kirk and Raven, The Presocratic philosophers (1957), pp. 87-93. Not up-to-date, mind, but it's a common book and it does go into detail about the mythological background and how the different references to Thales' teaching on water relate to one another. Here's a key passage:
... are we justified in inferring from the Peripatetic identification of Thales' water as 'material principle' that he believed the visible, developed world to be water in some way? This is the normal interpretation of Thales; but it is important to realize that it rests ultimately on the Aristotelian formulation, and that Aristotle, knowing little about Thales, and that indirectly, would surely have found the mere information that the world originated from water sufficient justification for saying that water was Thales' material principle or ἀρχή, with the implication that water is a persistent substrate. ... [But] Thales might have held that the world originated from an indefinite expanse of primeval water, on which it still floats ... without also believing that earth, rocks, trees or men are in any way made of water or a form of water.