Hellenic/Romanesque pagans ... [can't] ... all literally believe their myths actually happened.
I thought this rather presumptious. To my mind, the myths did occur. Maybe not exactly as we hear (or read) them today (generations of bards altering each tale to suit their listening audience), and maybe not in this world, but certainly in one form or another. I'm sure some of the characters may have changed, or merged (as he scriptwriters are want to do when rendering a book suitable for a screenplay), descriptions may have altered, feats exaggerated and so on, but that's not to say that the feats of the gods, heroes and ancestors didn't occur at all.
I am also of the belief that the myths were not concocted simply as a means of informing our ancestors of the best way to live their lives. In some instances, this may be true, but surely not all?
Perhaps I am taking things too literally myself?