If Plato is the only one who recounts the story, that doesn't show he invented it. Stories of actual events are lost all the time. Why would it be surprising to hear a story about a thing from only one remaining and preserved source?
Plato's dialogues were works of fiction that used fictionalized versions of real people as characters in order to illustrate philosophical points. The guy who relates the story of Atlantis is Critias, one of the members of the Thirty Tyrants, a clique who ruled Athens for a while, and Critias claims that he got the story from his distant ancestor Solon who was one of the lawgivers for Athens. To a contemporary of Plato's this would be as if he'd written a story about George Bush, relating a story that he'd gotten originally from George Washington, about how the United States had once fought a war against a long-lost evil empire back in the bronze-age. You weren't supposed to think it was true.
To me, this barely seems relevant to any criticism of the story. Plato had, at most, 2000 years of written history to draw upon (and I’d guess far far less at his disposal), so his estimate of the age of an ancient civilization is inevitably going to be quite far off.
I don’t disagree with the conclusion, but that seems like a minor glitch.
Is is possible that for an ancient Greek to describe an event as "ten thousand years ago", he means nothing more or less than "too long ago to remember when, exactly"? It may be unfair for us to backport our modern conception of numbers as these very precise values.
It sounds like you're saying it's clear from reading the text that the dialogue is manufactured, even through the ancient language / ancient culture barrier. But why does that imply the content is manufactured?
If you told me a story about George Bush telling a remarkable story that was passed down to him orally through every president from George Washington, the only reason I'd suspect you were making it up is because it's inconsistent with the many other sources I was taught from, which don't mention such a thing, and I trust that they are relatively complete with respect to important events. Did Plato's readers have analogous sources? Do we still have them today?
That is an assumption.
We have many places that use the same or similar names (England vs New England (us state). New Mexico(us state) vs Mexico. Its not inconceivable that there was more than 2 locations named Athens. 1 of which is currently lost buried or unknowingly called that.