Logic dictates it's an urban legend. If they got a bunch of returned/unsold cartridges, they wouldn't just throw them away, they'd disassemble them and keep anything that can be re-used. Cartridge shells, probably the circuit boards/chips or at least part of those, and they'd likely either trash or recycle the boxes and manuals and plastic, and keep any useful inserts. I mean, Atari 7800 cartridge shells are just Atari 2600 cartridge shells, I'd wager a large amount of those came from E.T. cartridges.
What the excavators are likely to find is broken console/controller/game parts (since it was obviously very common to throw those away), but a mountain of complete sealed copies of E.T.? Not happening.