Who started this lie?

I havn't heard that rumor, but I can confirm it to be totaly untrue. The game was complete for the 64dd, but never released due to the lack of support for the system in japan. Also, it doesn't add much to oot any how.
I don't think it was purposely started, just misinformation. I think that it was brought up that it was made for the 64DD released in Japan, and was interpreted and passed on that it was indeed released.
Well I think that in the information for the URA Zelda on Gamecube in America it states that URA Zelda was released only in Japan... which is misinformation because it was never released anywhere.