"Why is it that so many today assume that most if not all Biblical literature is straightforward factual description, and treat this as the 'default setting' when reading the Bible?"
It's a great question. James McGrath, scholar and blogger extraordinaire, poses it in the second edition of his book The Burial of Jesus: What Does History Have to Do with Faith. To be honest, I can think of a couple of kneejerk responses, but McGrath isn't finished yet.
"Might stories that feature talking animals be fables, or at least fable-like? ... There are a wider range of options than simply 'inerrantly-recorded history' on the one end and 'pure fiction' on the other."
On the strength of what I've read so far, I've no hesitation in recommending The Burial of Jesus, particularly as - thanks to ebook technology - the cost is a miniscule $3 on Amazon. Would that all biblical scholarship was this accessible! This is a book to challenge wooden-headed literalism of whatever persuasion, as well as extreme skepticism.
Link: The Burial of Jesus: What Does History Have to Do with Faith?