It's not an urban myth. Many publishers won't even consider books which have already been published, for all sorts of reasons.
I imagine this is true. I've come to respect your opinion in most things. However, "many" publishers is not ALL publishers, and the issue is not simple.
Here's my analysis based on my reading. If the issue becomes important to anyone, they should get a more authoritative opinion from an intellectual properties attorney (not just any attorney) or an agent experienced in the field.
If we have published a book or shorter written work in electronic form, we have used up our first ebook publication rights. We still retain our first print format publication rights. Many of us are in this boat. POD books don't sell well, or at least mine don't. And why should they? My ebooks are priced at a third of pbooks, and I believe this is common among self-publishers.
We can then sell first print publication rights. This can be for the entire world. But more often they are restricted. Common is first North American rights, first European rights, and so on. Often they are even more restricted, to specific European markets such as Germany. The Russian, Chinese, and Indian markets are also large ones, becoming ever more important. I've sold a few in each place, as well as in Nigeria where English is a second language. (Plus even more surprising markets: one (ONE!) each in Dubai, Egypt, and Saudi Arabia.)
Even the most optimistic measures of ebook penetration of the publication markets are little more than 20%. Any publisher who rejects a book because the book has come out electronically is missing an important opportunity. First print publication is still a valuable right.
So if we've also self-published a book in POD form, are we screwed? I think not. We still have reprint rights, audio rights, and rights to adapt a book into a movie or TV production. A book with promise (with the right agent) can be successful despite the gruesomely horrible stigma of being self-published.