I'm not sure what you mean by the term urban legend - and how it can be confused with history. Urban legends are a modern genre of legend about current times, not normally mixed up with people's perception with history. of course, since the genre has roots in the early twentieth century, it can be dated to historical times and can be studied as part of historical periods - if that's what you mean.

The following is an answer I wrote about history and legends awhile ago; perhaps this won't answer your question. You may need to reframe your question to make it clear what you're after:

Historical legends - like legends in general - are persistently and insidiously believable. The very process of repeated oral tradition acts like the flow of a river or the pounding of the sea's surf, rounding the rough edges of rocks. This can make the fanciful seem believable, and it is easy to make it indistinguishable from "the facts." That's a reason why it is easy to understand how the legendary became integrated into histories written in the past, but the process is by no means ended.

During my career dealing with Nevada history, my path frequently crossed a historian who characterized himself as a "myth buster." I had misgivings about that because while I valued "the facts" I also value the folklore (hence my user name!). The intersection of our careers demonstrates that believing in the legends persist and happily - from my perspective - no amount of "busting" will likely get rid of them. I have two examples of this:

The first involves Julia Bulette, a sex worker who arrived in Virginia City in about 1863 and was murdered in 1867. Legend came to remember her as the most remarkable of women - so remarkable that she helped the sick during an 1860 epidemic (which never happened) and she helped the wounded during the Pyramid Lake War of 1860 - both a full three years before arriving on the scene!

This was the subject of a presentation I made at the First AskHistorians Digital Conference: Sex, Murder, and the Myth of the Wild West: How a Soiled Dove Earned a Heart of Gold. AND!!! it's not too late to make donations (which are very much needed) for our second annual AskHistorians 2021 Digital Conference. Claim your rewards for donations NOW!!!

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So, over time, oral tradition took hold and remembered Bulette in fantastic ways, and the legends about her obliterated the real woman. In 1984, Susan James, my wife, wrote an important article attempting to separating legend from fact, and my myth-busting colleague jumped on it, making it his cause to de-legendize Bulette.

In the 1990s, I was attending a board meeting of the Nevada Judicial Historical Society. We were hearing a presentation about some digital presentations that had been assembled dealing with key historic cases that had been heard by the Nevada Supreme Court. Chairing the meeting was Cliff Young, who was also the Chief Justice of the Supreme Court. My myth-busting colleague attended the meeting, and he protested vehemently about the recording dealing with the case of the murderer of Bulette (who had been sentenced to die, and his case was appealed). The recording about the case included many of the legends associated with Bulette, ignoring the work of my wife and the efforts of the myth-buster. In response to the angry tirade of the myth-busting historian, Chief Justice Cliff Young roared back that he wasn't about to have history ruined by someone who wanted to take away its charm.

Here was the tension, expressed in the late 1990s, between history and legend. Several of us on the board later, quietly, had the audio reworked so the offending passages were removed, but I can assure you that no amount of effort will effectively eliminate the legend from history. For that I have another example ...

Virginia City's statue of Lady Justice is well known as one of two in the nation without a blindfold. Residents will helpfully tell anyone who asks that the Storey County commissioners purchased the statue for their new courthouse in 1876 as a commentary on the fierce, unflinching frontier concept of the way courts should seek and punish criminals. Comstockers (as those living in the mining district refer to themselves) are committed to the idea of presenting the truth about their past, even when it is not supported by the facts.

In the 1980s, I sought to verify that Lady Justice of the Storey County courthouse was, indeed, one of two in the nation without a blindfold. Hearing that I had contacted other states (in a time before the widely connected internet) to find other examples, a few residents hedged their bets and said the statue was perhaps one of three in the nation with eyes exposed. Either way, proving the scarcity to be true would underscore the significance of the statue.

As it turns out, I found over two dozen unblindfolded versions in the United States and several more internationally. I also uncovered evidence that Lady Justice was commonly shown in the nineteenth century with unobstructed eyes, and that county authorities had the option of purchasing the statue with or without a blindfold. This specific version of statue came from a foundry in Williamsburg, New York. Justice cost $236, and shipping was included!

Then there was a question about what to do with what I realized was an expression of Comstock folklore. By strict definition anything that circulates orally – as a matter of tradition – can be referred to as folklore. Truth is not an issue. Folklorists don't adjudicate the issue of survival in the afterlife to determine if a story about a ghost is fact or folklore. That the narrative circulates is sufficient. On the other hand, proving that a story spreading about the past is wrong becomes a vivid marker that points to folklore. When I began investigating Lady Justice, I initially assumed that Comstockers were merely recounting an aspect of the legacy that surrounds them in one of the largest National Historic Landmark Districts. Afterall, they celebrate many aspects of their past, and it would be awkward to classify everything they say about their heritage as folklore. Finding out that an unblindfolded Lady Justice was not unusual, meant that the ubiquitous story about her was apparently folklore.

I began asking residents where the other unblindfolded statue could be found, and I received different reports. Many indicated Aspen, Colorado, but other places surfaced. It seemed to me that having "one other statue" in the story was a way to accommodate travelers who reported one in another location. The "other location" could be forgotten, leaving the caveat in the story to serve the next revelation.

I was, however, faced with the problem of how to deal with what my research had revealed. I was preparing to publish a book on the history of Nevada courthouse, and if it were to include the fact that there were many similar statues, it might extinguish the legend, a colorful aspect of local folklore. There was little choice but to state the facts, and yet the consequence of publishing my research remained a concern.

Eventually, I was pleased to find out that the disclosure in my book had no effect on local oral tradition. Over the years, I found that Comstockers celebrated my book, which included an image of their courthouse on its cover. One resident was in the habit of giving the book away as Christmas presents, being particularly enamored by the way her building was celebrated. One day while giving students a tour of Virginia City, I was at the courthouse, and that same woman told the students, "You know, the statue of Justice on this building is one of two in the nation without a blindfold." She then told them about how the county commissioners had wanted the statue that way because frontier justice required demanded a constant vigilance.

Folklore had survived the written word of history. I could not have been more delighted. I have published many things on the Comstock, but as a folklorist, I have always hoped that my work would not damage local tradition. With this example, I hoped my concerns could be set aside. In the same way, this book represents an opportunity to set aside the facts while exploring how early Nevadans defined their own truths, and how some of that tradition survived and continues to shape regional folklore.