The ancients, naturally, knew and understood less than we moderns. Some ancient writings are accurate, some are not. Is the antiquity of a text a valid reason to reference it in a discussion?
Although several people have already provided good answers to this question, in a nutshell ancient texts can be completely valid in context, as long as there is external evidence (other sources) to clarify or support what the text indicates. However, using an ancient text as the
sole source, especially if it's self-referential, is invalid.
Adherents of other religions, or none, however, are under no obligation to accord the text any authority. Are holy texts useful when discussions include non-adherents?
Of course. The Mahabarata is an excellent source of ancient Hindu history - as long as you can separate out the myth from the reality. It can be used to explain why certain cities were important, lists several historical figures (and some allegorical figures), etc. However, you are absolutely correct that no one is under any obligation to take the whole as the sole authority.