Stories about events we can identify in the archeological record, probably. Forest fires, major battles, geological events, things like that which can be used to line the stories up with specific real-world events
I strongly believe that it happened. It doesn't need to be a "flood of biblical dimensions" but just one terrible enough to convince a few early tribes that it was the end of the world as we know it.
I feel like the myth existing in cultures around the world from Mesopotamia to the Americas gives it credence. It makes sense that a "world-changing event" would work its way into various disparate cultures myths.
Absolutely, water being such a vital part of life pretty much ensures it'll be referenced. Kind of the same thing as various sun gods in cultures around the world.