Short answer to number 1 is yes. Answer to number 2 is, as often as not, it is never corrected. Once a person has decided something is true, even in the face of clear evidence to the contrary, they will never truly change their mind.
It's actually pretty well documented that people have an amazing capacity to "see" what they're looking for and to not see what they don't want to see. There are a couple of reasons for this (lots of reasons, actually, but two jump to mind). The first is cognitive dissonance, and the second is the power of intermittent reinforcement.
Cognitive dissonance refers to the ability for people to screen out information that doesn't conform to a strongly held belief. In other words, it's the ability to reconcile conflicting information so that one can believe in something in the face of clear evidence to the contrary.
Intermittent reinforcement is a behavioral phenomenon where we are actually more inclined to create a habit and draw a causal relationship to an action based on infrequent or intermittent success. For example, my dog bumped his nose up against one of our doors and was able to pop it open and get into a room he wasn't supposed to be in. It happened one time, and based on that success he began testing every door when he gets bored. Over the years, doors don't get fully closed, but in spite of maybe a .1% success rate, that damned dog gets his nose prints all over our doors to this day.
In humans, this phenomenon can be seen all over the place, as well. Computers in particular have made people superstitious, but even in martial arts we can see the power of intermittent reinforcement. We experience some kind of success with a move and even though that move may not work again ever, we will continue to insist and train it because, after all, it worked once. Or on computers where someone will perform voodoo on a computer to 'fix' a problem, or click on a link 10 times to get it to work once.
It's also very common in religion and in politics. Something is seen and conclusions are drawn as to why that "something" came to be, and those conclusions become reasons, and those reasons become absolute.