What is the traditional and perhaps inaccurate or misleading idea of what nonfiction writing is?

It is inaccurate to define nonfiction as writing that is true or real because nonfiction is not necessarily "true" or "real." Non-fiction is instead defined as something that is an account or representation of a subject which is presented as fact. Thus this presentation may be accurate or inaccurate, and it can give either a true or false account of the subject at hand.

More importantly, though, in nonfiction it is generally assumed that the authors of such accounts believe them to be truthful at the time of their composition. Memoirs for instance, are the memories of the subject and while we assume them to be true, memory is a very tricky thing so instead of them being "true" by the definition of true as we know it; it is true as best as the author can remember it.

The true crime genre is an example. The author cannot know what the victims of a massacre were thinking before it happened, or every move these people made before they were all killed, so it is appropriate for the author to create these details in an effort to complete the narration. As long as the details that can be verified are true, then it is still nonfiction. To reiterate: nonfiction is not writing that is true or real but instead is writing that we perceive to be true or real and has a basis in fact.