When I was a child of no more than 5 or 6, my grandfather took me for a walk in the park. He told me that bears lived in the park. This park happened to be located in suburban southern New Jersey near Philadelphia, and there hasn't been a bear seen for 100 miles of there for more than a century.
While in the park, a tree branch broke off and fell to the ground with a crack and a thud. I thought it was a bear. Terrified, I ran to my grandparents' home in tears and in terror. I ran to the arms of my loving grandmother, and told her I was being chased by a bear.
Eventually, after I had calmed down, my grandmother told me that no bears lived anywhere in Camden County, and that it was probably a squirrel that caused the tree branch to fall.
Although my grandfather had meant his story to be just that -- a fable -- I believed it until I learned the truth. During my youth, I looked upon my grandfather as a liar, and didn't trust anything he told me for several years.
Other stories I was told as a child by family members and believed:
* If you curse, your lips will be sewn shut by a dragonfly.
* If you swallow a watermelon seed, watermelons will grow inside of you.
If I were a parent, I would never teach such foolishness to my children. I would be certain that they understood that Santa was a mythological figure, not a real person.
There are enough interesting real things in this world that would interest a child than to have to resort to filling their heads with things they will eventually have to unlearn as untrue.
Did the teacher overstep their bounds? Perhaps, but by the same token the teacher may have saved an uncomfortable situation by setting the record straight on Santa. There were probably already at least a couple of children in that class who knew that Santa is not real. Children face enough confrontations with their peers already than to have to get involved in an argument over the existence of a myth.
