This can be a challenge, and it requires source criticism - understanding each source in its context, determining what the author may have intended, how it was written (and often re-written) and how it was/may have been received by the audience/readers.

We can understand myth to be documents written in attempt to record, synthesize, or adapt contemporary oral traditions. Usually the term is applied (or at least it is best applied) to ancient settings. Given this, we can understand that ancient documents of contemporary myths are some of our best clues about what folklore existed at the time, Because the writers were not professional folklorists, we have to acknowledge that these weren't expertly recorded expressions of folklore, but with this understanding, it is possible to exercise the appropriate source criticism and move forward.

Documents with expressions of folklore come in many forms. The best are recently documented narratives, recorded electronically by professional folklorists. At the other end of the spectrum are untrained enthusiasts writing the stories they have heard, necessarily changing it in the process and often abridging the narratives. Before the twentieth century, this often included some sanitization of the stories so that a final published book could be marketed to children.

Does anything in this range of possibilities reflect real events? Or perhaps more appropriately, should anything of real events be searched for in these types of documents?

First of all, folkloric narratives fall into two camps: those that were told with the intention of being fiction and those that were told generally to be believed. An excerpt from my Introduction to Folklore, which I used when teaching folklore at university:

Legends – or Sagen as the profession often prefers – are generally short, single-episodic stories told chiefly in the daytime. More importantly, the teller intended the listener to believe the story. Legends often have horrible ending to underscore the story’s important message. Many of them are, after all, meant to be instructive, to serve as warnings in some way. These types of stories are not necessarily long-lived. Their point is to reinforce and prove the legitimacy of a belief. Nonetheless, some legends take on a traditional character, can become multi-episodic, and migrate over considerable spans of time and space.

Folktales – or Märchen, again using the German, technical term – are longer stories with more than one episode. They are restricted, in theory at least, to evening presentation. A folktale is not to be believed, taking place in a fantastic setting. The European folktale also requires a happy ending, the cliché of “happily ever after.” Any given folktale can be told with considerable variation, but they are traditional in basic form, and folklorists have spent decades tracing the history and distribution of these stories.

Some scholars (usually not folklorists) attempt to seek the "real event" behind various folktales. This seems to me to be a fool's errand.

If we look at the widespread folktale type, ATU 300 (ATU = Aarne-Thompson-Uther), "The Dragon Slayer," we see that it manifests in the ancient Greek story of Perseus as well as in later stories of St. George and the dragon. If we were to explain this as based on a real event, we would need to look for some "proto-Perseus," and given how widespread the story is, that person and his heroic deed would have to be projected many millennia into a prehistoric past.

This is the sort of problem that we encounter with folktales. At the same time, we must acknowledge that in ancient Greece the story of Perseus may have been told to be believed. Just because it circulated in recent centuries as a folktale does not mean it didn't circulate as a heroic legend in ancient times. The folk are notorious for not following their own rules, and genres of narratives often drifted across boundaries!!!

Then, we need to consider the genre of legends, narratives told generally to be believed. Not all of these stories are created equally: some discuss the origin of things in improbable ways; others describe more recent events in what is referred to as historical legends. This latter type of narrative can be based on a real event, but the "facts" such as they are typically drift. George Washington did not likely chop down the cherry tree and then confess the act to his father, but Washington (and his father) did exist, so he is automatically one up on Perseus!

At the same time, folklorists maintain that they have observed hints in indigenous Australian folklore describing islands that existed before the end of the ice age and subsequent rise in sea levels. This is controversial, but it and other similar events (the eruption that produced Crater Lake in Oregon, for example) do seem to be reflected in local legend.

Then the question must be asked about what we can learn about real events from these expression of folklore. The answer, sadly, is not much. That local people retain a folkloric memory of the event is of far more interest than are any details expressed in the narratives.

We can see an analogy to this if we consider conspiracy theories, a modern expression of folklore. Do conspiracy theories describe real events and/or people? Typically yes. Would scholars go to those theories to arrive at a better understanding of real events and/or people? Typically no. Scholars would go to the conspiracy theories to understand the people who put them forward, not to understand anything in the real world.

I'm not sure if this is what you're after. Let me know if I missed the mark!