Do They Know What They Think They Know?

So I was thinking about how I've never been to the Grand Canyon, but I know some things about it (and I almost certainly have some misinformation about it, as well). So what about the PCs - they've never been to the Grand Smoking Mountains in the East, yet they may have heard about them. And since that's the destination for the next part of the campaign (either because they chose it or it's part of the Adventure Path - whatever). So they're going to go to the mountains and one of the players says, "What does my charcter know about these mountains?"

Do you just summarize what is general knowledge? Do you roll on some kind of "rumor" table? How about individual write ups for each character?

I think tailored information would be best - though very time consuming to put into practice. The elf in the party might "know" that there are tribes of wild elves in the mountains constantly at war with orcs and goblins and that there are Aarokroka (sp?) tribes in the mountains who eat elves. The party dwarf might "know" that there are no dwarven clans presently in the mountains since the great Plague after the Landings Wars and that any dwarven halls are still haunted by disease ridden dwarf zombies and all the treasure in the halls was certainly taken when the dwarves fled the plague halls. A human character from the Western Alliance might "know" that the mountains are haunted by elven undead, who rose up after the Landings Wars and that humans are eaten by the various humanoid tribes in the mountains. A human PC who grew up close to the mountains might "know" that the mountains are wracked by almost daily thunderstorms and that there are active volcanoes in the range that are gates to the plane of fire and that Giants fight against demigods in the uppermost regions.

Yeah, that's not that good - but it makes the point. How to handle the fact that PCs would "know" different things - and that not everything they think they know can be true. For example:

There are dwarf halls haunted by undead, but they are not devoid of treasure, nor is the plague still a threat in them. There are elves in the mountains, but they are the canibals of the region, having driven the humanoid clans far away. There are giants and a couple demig0ds in the mountain range as well, though they are much more likely to work together (against the elves) than to fight one another. And, yes, there are daily thunderstorms and multiple active volcanoes - though there are no (known) gates to the plane of fire...

So, if I know that characters are going into a heretofore unexplored area, how much knowledge should I assume they have? And how should I handle it? I suspect it's generally handwaved, maybe with a few rolls on some rumor tables. And maybe that's enough.

I suppose that it would be a simple matter to roll up a few random rumors, then simply write it out as a paragraph: "Granock has heard that the Mountains are the haunt of..." and hand it to the player. It would be interesting to see what they do and don't share with their fellow players.