Does the phrase "legend has it" mean a legend is factually accurate?
Solution 1:
"[Legend] has it" in this usage simply means says or states.
It could be expanded to "has it down as", or is probably best rephrased as has already been stated as "according to [legend]".
Solution 2:
It means "according to legend" and has no bearing on accuracy. It's similar to saying "rumor has it."