How did the people in the Naruto Universe forget about their history? Can somebody explain the timeline of Naruto?  

Apparently everything started off with the Sage of the Six Paths creating jutsus (with no info on society before it), and then a couple generations later Konoha is founded. Then about two generations later Naruto becomes this savior of the world.

Judging from this, people forgot even though the span of their history could only be about 1000 years.  

Let's say the Six Paths was 1000 years ago and the Konoha as well as the other major hidden villages were founded around 300 years ago.  What happened in those 700 years?

How did the people forget their own history, in such a short time?  Did everybody just forget to tell their children stories about the strong people of their time?  Was there no form of writing or stories passed down generation to generation?

Note: I'm not saying that the history was only 1000 years, it might have been longer or even shorter.  There was no evidence to it so I estimated it by generation.  Each new generation every 60-80 years.
Naruto/Naruto Shippuden is mainly focused on the tale of the gutsy, unpredictable, strong willed protagonist ninja Naruto. Everything that relates to him is shown in the story.

Of course, the sage of Six Paths taught people the Jutsu. An art of fighting to protect themselves or the weak to retain humanity on earth. The human race were then able to use Justsu to at least fight against beasts/animals (for example, the ten-tails which attacked)

People later started to misuse Jutsu, stemming from their hunger for power and wealth.

The history prior to Rikudō Sennin is not important to Naruto's story so it is not mentioned anywhere. That doesn't mean that the people have forgotten everything.