Hi Nick,
Thanks for the thoughtful response.
No I don't think they just made it up. At this tie in Roman society there were many splinter religions. Like the USA the gov allowed them to be as long as they did not cause problems. Mirtha was one such sect. Lots of it can be found in the Christian story. Seems like sects merged what they liked about each one.
I know this is a common perception, i.e. that Christianity is an amalgamation of other religions. I’m not sure who originated it, but this idea comes from a shallow understanding and narrow view of these religions. When one looks at the details, not the superficialities, then the claim really doesn’t hold any water. We don’t have to get into it much, since that’s probably not what you got into the conversation for and I’ll be unavailable starting tomorrow for a couple of weeks. (Hmm, doesn’t seem fair to post and run. Sorry about that.)
Some of the things that one has to consider when making the claim are – “Is there a natural progression from Judaism to Christianity that would explain these aspects?”, “What was the attitude of the Christians to the other religions?” and “How and from where did the unique aspects of Christianity come from the pagan religions?” The answers to these questions make it nigh impossible to stick with that claim.
Anyhow, when the gospels were written I do not think they were ever meant to be taken as historical. Therefore, places and times were not that important. It was all about the ideal of how to live and become one in search of knowledge.
Yes, I agree with much of what you say here. They were not taken as historical in the sense that we think of historical works today. However, “one in search of knowledge”? That would be accurate for the gnostic religions, but not Christianity. The Bible and the early Church Fathers are pretty clear about that.
Then the Dark Ages came along and it all went to hell...so to speak.
Yes, so to speak.

But let’s go back to the original question. None of this helps us to answer the question of why they would claim Jesus was from a place that didn’t exist? They didn’t take it from another religion, so that’s not relevant.
Also, we have Jews preaching about Jesus to Jews (and no one complaining). It doesn’t make any sense that they would make that up. Why not say that he grew up in Bethlehem? Or better yet, from Jerusalem?
You might say that people from Bethlehem or Jerusalem would say that it wasn’t true. But those same people would be able to say that Nazareth didn’t exist! It’s much easier to make up one person in a large city like Jerusalem than to make up an entire town.
But then you could say that they weren’t only talking to Jews, but to Gentiles, as well, and the Gentiles wouldn’t know any better. That’s not very tenable either. Nazareth was about four miles from Sepphoris, which was the capital of Galilee, a major center of political and economical activity, and the home of Herod Antipas. (DeVries, LaMoine (1997), Cities of the Biblical World.) We may think of the people as backwoods, but they were well traveled. A made up town in the heart of things would have been ridiculed.
And why position Nazareth as a wretched place in Galilee? Nathanael points out that nothing good can come from Nazareth (Jn 1:46) and in other places the apostles are scorned because they come from Galilee.
No, if we actually look at the details of the situation, it just doesn’t make sense that they would do that.