Brad, to your core question," Is it possible for a passage of Scripture to still be true and authoritative even if it is written about an event that the authors thought was historical, and yet is not historical?" I would say yes you can find truth in a work of fiction. All the great works of fiction tell of some truth about the human condition. It’s the authoritative part that troubles me. We look to the Bible for authoritative answers to our questions. Often though, the answer can be ambiguous. It all depends on how a passage is interpreted. So it’s not much of an inerrant authority without an inerrant interpreter.
In the Middle Ages the Church was the authority in things spiritual. When the Reformation came along and rejected the authority of the Catholic Church the reformers needed to replace it with something else, the Bible. The only problem was that the many understandings of what the Bible is teaching has led to many denominations. We have no final or ultimate authority because everybody is free to come up with their own interpretations and find a church that agrees with them. If your church hires a woman as Pastor and you don’t think they should because of your understanding of the Bible then you are free to find another church. But if you are deciding what the Bible is saying about something then you are the authority as much as the Bible is the authority. So it’s not much use to have an inerrant Bible without an inerrant interpreter.