SATHYA SAI BABA TAUGHT EVENTS IN THE INDIAN SCRIPTURES AS HAVING REALLY TAKEN PLACE
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Sathya Sai Baba firmly claimed in many contexts that the events described in the Ramayana, the Mahabharata inc. Bhagavad Gita, and the Srimad Bhagavatha took place! He insisted that:-

1) he was himself Krishna and was 84 years old at time of Mahabharata war (Summer Showers at Brindavan 1978, page 58)

2) that this war took place in 3138 BC. (Summer Roses on the Blue Mountains 1976. p. 85f)

3) that as Krishna he performed the miracles described, such as multi-location of his body in a simultaneous dance with six thousand cowgirls (gopis)! (Sathya Sai Speaks Vol. 26, pps. 27-29)

4) that he was also Lord Rama and did what is told in the Ramayana, defeating demons, flying in mantra-driven 'airplanes', killing Ravana, banishing his wife etc.
Sai Baba strongly affirmed the literal truth of these scriptural 'tales', as is seen in the following conversation:

Dr. J. Hislop: "Sometimes Swami speaks of the Ramayana and the Mahabharata as if they were historical, and sometimes as if they were to be taken as representative of every individual's inner conflicts, virtues, bad qualities etc. Are these events and people historical fact?"

Sai "Yes they are a record of historical people and incidents... Rama was a real person and an Avathar. And Dasaratha was His father. Krishna was real and the events of His Avathara were real. Rama's life, over the ages, has been altered and distorted somewhat, and Swami's story of Rama will be a classic through several Yugas." (Conversations with BHAGAVAN SRI SATHYA SAI BABA by Dr. John Hislop - P. 129 new ed. P. 155 old ed.)

The following story from the Mahabharatha was told by Sathya Sai Baba on two occasions in very different versions. In the first instance it was presented as if it were factual, as in this concise resumé of the rambling tale:
"The cowherd Maaladhaasa who was determined to see the Lord and prayed to the "black Lord riding on a white bird". Due to his fasting and prayer, the Lord did at last appear to him, but as an old Brahmin, but he was not black and there was no bird. So the cowherd asked the Brahmin to come next day again so he could get the village pandit to say whether he was the Lord himself. The pandit laughed and the whole village turned out next day to see this Brahmin, but only the cowherd Maaladhaasa could see him. He was ridiculed...
Let Sathya Sai Baba take up his rambling story here: "At last, he got so enraged they he walked up to the old Brahmin and gave him a whacking blow on the cheek, saying "Why don't you show yourself to all?" That blow changed the entire scene. Krishna appeared in resplendent robes, smiling face, captivating form and the white bird. As the astounded villagers were recovering from the amazement, the heavenly chariot (Vimaana), floated down from the sky and Krishna asked Maaladhaasa to sit inside it. Then, with the Lord by his side, Maadlahaasa rose up and soon was out of sight." (Faith that made the lord manifest (cowherd story)
(Sathya Sai Speaks Vol 7, pps 7f)

So the reader is supposed to take this to heart... Sathya Sai Baba is that same Lord, very hard to recognize, and we all should compare ourselves to the astounded and amazed villagers!!

The second version, delivered by Sai Baba to students in 1984 as a story, is reproduced in Al Drucker's publication "Discourses on the Bhagavad Gita" (p. 32 first ed.) in the sixth discourse. Here a poor cowherd boy is told by the pundit Harikathadas that Lord Vishnu was traditionally represented as "dark/complexioned, wore a traditional white mark on his forehead, and rode on a white eagle". The story drags on through the boy's penances and prayers and ends with Vishnu showing himself in the form desired to the cowherd.

The discrepancy between the two 'stories' is typical of many of Sathya Sai Baba's tales and accounts. The famous elderly editor of his journal, the retired journalist V.K. Narasimhan, told me that he corrected errors and mix-ups in Sai Baba discourses when he translated and edited them. He was worried that he would be 'brought to book' (as my notes at the time show he expressed it) by outsiders who hear the recorded tapes and compare them to his altered versions. (Narasimhan died in 2000). He also told me how, while interpreting to English a talk by Sathya Sai on Kalidasa's famous play about Shakuntala and the wedding ring, Sai Baba mixed-up the story, making the ring a gift from Shakuntala to the king and not, as in the original, from the king to her. Narasimhan told me he whispered this to Sai Baba, who told him to translate it just as he had said it, that is - incorrectly! It did not much affect the point of the story, but it was different from what Kalidas wrote.