Your premise makes sense, except for the fact that I think that the story of Atlantis is attributed to the Egyptians. Like other things that were from Egypt it later became attributable to Greece and it may have been re-purposed for another time and civilization.
Second of all many scholars have always theorized that Egypt itself was a part of a larger empire. Egypt was generally considered the outpost of that empire. So that might explain why Egypt itself was so advanced and so old.
I do agree with you though that Atlantis is likely an allegorical tale. However, the rise of Egypt does lend credence to the notion that there was an older civilization before it.