vastly overestimating how much information a typical person in a typical D&D setting has access to.
Whoah, hold on!
I established that a literate person CAN know about things they haven't personally seen. I didn't say anything about specific probabilities.
Sure, the percentage of people reading this thread who could recognize a camel might exceed 95%, because, as you say, we're literate members of a civilization with mass media. The probability of the elven scholar having seen a picture of a camel might be much lower, maybe as low as 5%. But it isn't *flatly impossible*, under appropriate circumstances, to recognize something one haven't personally seen. I am, at the moment, discussing the difference between "zero, no roll possible" and "nonzero, there is SOME chance", rather than the differences between 5%, 50% and 95%.
Also, "literate" already means we're NOT talking about a typical person in a typical D&D setting, assuming that 90% of humanity in a low-tech setting are illiterate farmers. Mid-level fighters, monks and rogues have abilities which would amaze the real world's elite soldiers, martial artists and athletes. Are you sure that a D&D elven scholar has read fewer books (in the last few centuries) than the senior archivist at the Library of Alexandria? In some ways, the typical D&D setting has resources WAY beyond what Imperial Rome or Renaissance London had, and also way beyond what we have today, such as invisibility, teleportation, resurrection, and the Legend Lore spell.
Yes, I'm familiar with Herotodus's descriptions of the lands south of Greece, with no distinction between one tale's credibility versus another's. A few centuries later, and a few hundred miles away, a Roman shopkeeper might have personally seen lions, tigers and bears in the arena, as well as ostriches, auks and aurochs, not to mention camels. Meanwhile, there's zero chance that anyone in Imperial Rome was familiar with turkeys or kangaroos, neither directly nor by written reference. If Doctor Who takes a Roman scholar to the Americas or the Outback, there's no roll to see whether the scholar recognizes those animals. D&D settings vary; the DM knows which setting this campaign is using, and which part of the setting.
If you, personally, today, could cast Legend Lore, once, in the real world, what would you research?