Agreed.....there are just too many holes. Plus, if so much of the Bible is a parable or allegory (like the Prodigal Son), why can't it be that this is the case for the entire book? Where do you draw the line? I'd like a theist's thoughts on that.
It could be, but it is important to remember that the Bible is not one book or one genre. In fact, genre often switches from chapter to chapter: you get poetic language followed by myths followed by genealogies followed by more straightforward historical narratives, and that's just in Genesis. It's just as much a hasty generalization to say, "I believe this is a myth, therefore the entire Bible is a myth" as it is to say, "I believe this story is a historical event, therefore the entire Bible is historically accurate."
The first step in analysis is to determine what genre you're reading. It's generally accepted in theological circles that Genesis 1 uses heightened (poetic) language in its original tongue, and thus should be read as such. It's also generally accepted that most of the stories pre-Abraham have a mythological structure and share similarities with other ancient myths, which puts them into context.
The next step is to determine the historical context in which the stories were written. For instance, Genesis 1 was most likely written during the Babylonian exile and presents a more orderly creation account than the Babylonian creation myth, suggesting that it may have been set up as a theological contrast to the Babylonian religion. As another example, the first covenant between God and the Israelites has structural similarities to ancient contracts between kings and subjects, giving insight to how they viewed God. And newer books like the Gospel of Mark use ancient literary devices such as chiastic structure, which may be missed by the modern casual observer.
Lastly, it's important to remember that ancient historians did not place as big a value on objective reporting as we do today. Ancient writers would often say, "God did X" instead of, "X happened and some people attributed it to God." So in many places in the Bible, the author's interpretation is written into the text.
With these in mind, we can analyze the text and try to determine what the original author intended to say at the time the text was written, and (for believers) the spiritual meaning for the text in our own lives. And there are people much smarter than me who do Biblical scholarship for a living working with the original languages who can give some really cool insights on various pieces of text. It's actually a shame MTO got herself banned because she knows a ton about this stuff.
For an example of a cool insight, can you tell from reading the Noah story that there are actually two versions of the story woven together?