I am not too sure about the quote from Socrates, I think there can be knowledgeable evil, but I do agree with Mark Twain (and perhaps Herodotus), that historians ofter modify history as do many genealogists. I picked up a story yesterday written about one of my son-in-law's ancestors and began like a Victorian romance novel. It was a story about pioneers and I can only assume that as the trudged across the continent, they did not feel all that romantic. Now, there is fiction and there is history, I suspect that a lot of what I read in stories about my own ancestors is more fiction than history. Is this bad? Well, I suppose if you like historical fiction it isn't, but if you are researching history with the intent of preserving what happened, it certainly creates some very interesting problems.
I may have mentioned this before, but one persistent story from my past, involves one of my Great-great-grandmothers who is supposed to be the illegitimate daughter of a King of England. I won't repeat the details here because of the fear I have that my repeating the matter will only lead to further speculation. There is absolutely no basis for the story which likely arose as a result of some attributed opinions that the ancestor looked very much like Queen Victoria. But I had that story told to me by one of my cousins as actual fact. Stories have a life of their own and like the game of messages (with a lot of different titles) where the participants whisper a phrase to someone and pass it down the line and then compare the original to what gets related at the end of the line.
I don't want to diminish the value of stories to give life to the dead past, but the stories shouldn't do this at the expense of historicity.
Careful research will sometimes uncover facts that exactly contradict a traditional family story. This is especially true when the story involves a famous historical figures. People have a tendency to enhance the relationships their ancestors had with important people. My Grandfather may have been a private in the National Guard, but he served with Pershing and Patton in the Mexican Border Campaign, despite the fact that he may never even have seen either of these men. In the retelling, the story could likely enhance the contact he may have had with either of these historical characters.
The value of stories to turn the hearts of the present generation to the past is evident, but it is a jarring experience to find out that the treasured story, told to you in your youth, has very little, if any, support in the history of your ancestors. This is also true for newspaper reports. If you happen to know the details of a news story, because you are or were involved, you can frequently pick up small and large errors in the reporting. This is particularly true of stories that have a dramatic or emotional impact. The writer will almost always try to increase the appeal of the story by increasing the drama. The same thing happens when a story is transmitted from the past. In even some simple things, some of my close relatives related stories about their own past that discovery of documentation refuted. One example was the difference between how well one relative did in school and subsequent discovery of a series of report cards. Again, I don't go into details or give names to protect the innocent.
I guess the summary of this post is that any transmitted story should be checked against the known facts and preserved as a "story" and not as history. If there is substantiation of all or part of the story, then a citation to a source should be provided. Simply copying and repeating traditionally held stories is not history and certainly should not be genealogy.