While ancient texts can serve as a "guide" of sorts to what may or may not have happened they are not evidence on their own so, to answer your
concerns about the Talmud and how reliable it may be, I'd say that it alone cannot be counted as evidence (I know I am committing a capital sin here,
not abiding to a Hebrew sacred text, but that's me
[/end sarcasm]). Without some kind of "outside" reference to what the Talmud claims I, at
least, cannot take it for granted. I wouldn't go as far as deny everything in it, I just remain a bit skeptical about its content and to what extent
it may be true.
You said it yourself, ancient people built their homes, temples, city walls, etc, with material available and durable. Stone is surely durable and
available in most places but, as building material, it has limitations. While it is one of the best insulating building materials one can find (a
stone build house rarely needs air conditioning during the summer and requires less fuel to heat during the winter, compared to brick or wood
buildings) stone cannot "rise" very high, like steel does. Building with stone alone would prevent architects from erecting some of the most
spectacular buildings we see around us today, the buildings would be extremely heavy and thus unstable above a certain, not too great, height. They
would be very durable though
On the other hand, not being able to exploit the land "vertically" would mean that New York City, for example, could be spread over an area many
times larger than it is today (apply this to all major inhabited areas with high rise buildings and you will see the obvious problem, lack of space!).
So, there are advantages to using material less durable but more "workable" than stone (it is cheaper, for once, since no special skill in
stonecutting is required).
Of course, the ancients could not try their hand in building with, say, steel or glass simply because their technology (both in manufacturing and in
applying said materials) was not advanced, to say the least.
About wood, as building material, nobody said the ancients didn't use wood in their constructions, buildings made entirely out of wood though tend to
decay quite fast and usually are a distant memory after a couple of centuries. As far as I know, there is not one wooden building (entirely wooden!)
that survives in its entirety and that is older than, say, 1500 years (if that!!).