In my opinion, the Sthala Puranas not only enables us to have an insight into history but also enrich our knowledge of local culture and local customs. It seems to me that if they are read together in a connected manner they will throe more light on our history than even the 18 major Puranas and Upapuranas. In fact, they fill the gaps in the major Puranas.
Local legends do help in a proper understanding of history. For instance, educated people today do not believe that Sankara Bhagavatpada visited any of the temples or that he brought the puja performed there under a certain system. "The great non-dualist that he was and exponent of the path of jnana, " they argue, "he would not have concerned himself with devotion, temple worship, the Agasmas, and the like. " But let us examine the stories that tell us that he gave new life to certain temples, temples that are thousand miles or more apart. Their connection with the Acharya is confirmed from such stories and local legends. The priest who conducts the puja in Badrinath(a) in the Himalaya is a Namputiri Brahmin from Kerala -he is called "Rawal". Here, in Madras, the puja at the Tripurasundari temple at Tiruvorriyur is also by a Namputiri. This is proof of the oral tradition according to which the Acharya was a Namputiri who engaged fellow Namputiris to conduct puja in the temples he revived.
In teaching us lessons in dharma also the Sthala Puranas are in no way inferior to the major Puranas. It is in fact these local Puranas which are a few hundred in number that throw light on the finer points of dharma. Unfortunately, even the religious-minded among the educated class today think poorly of them. But, until recently, these Puranas were treated with respect by learned men in Tamil Nadu. Distinguished Tamil scholars have written Puranas after those existing in the name of great sages and also a number of Sthala Puranas. There are works in Tamil describing the importance and significance of places and temples - they are known variously as Sthala Puranas, manmiyam, kalambagam, ula, etc. ("Mahima" means greatness or glory; manmiyam is its Tamil form. )
Tamil literature is divided into the Sangam, Tevaram-Divyaprabandham and Kambar-Ottakuttar periods. Scholars describe the 16th century as the period of the Sthala Puranas. The chief authors of such works are Kamalai Jnanaprakasar and Saiva Ellappa Navalar. We know the worthiness of Sthala Puranas from the fact that among their authors are Kacchiyappa Sivachariyar (he composed the Kanda Puranam), Paranjyoti Muni (he is the author of the Thiruvilayadal Puranam), Umapati Sivachariyar (a distinguished teacher of Saivism), Sivaprakasa Svami, the Irattai Pulavars, Antakkavi Viraraghava Mudaliar, Kottaiyur Sivakkozhundu Desigar, Trikuta Rasappakavirayar. In recent times there was Mahavidvan Minaksisundaram Pillai who was the guru of U. V. Svaminatha Ayyar. He has written a number of Sthala Puranas. We learn from this that Sthala Puranas have a place of honour in the Tamil religious tradition and literature.
A distinguished Sanskrit scholar and authority on the sastras, Karungulam Krsna Sastri, has written a Tamil work called Vedaranya Mahatmyam.
Tamil rulers gave their support to Sthala Puranas and their propagation. More than four and half centuries ago, the Puranas relating to Pancanadaksetra (Tiruvaiyaru, Tanjavur) was translated into Tamil. The translator mentions that he undertook the work as desired by Govinda Diksita who was responsible for the founding of the Nayaka kingdom of Tanjavur.
For a general background, please see here