elder girl, being able to sing well and interpret a story in a song, is something that will vary from performer, it would be a generalisation to make a blanket staement saying it does help or it does not, this is something that will vary from performer to performer, it may help some undertstand the song better,there may be some who can sing the song well without knowing the background.
I like to know something of the background of a song but it is not absolutely essential.
I enjoy singing willie of the winsbury for example, but the fact that the tune i use was put to the set of words by andy irvine and was originally the tune to false foodrage does not help me to sing the song better, or interpret the song better.
so I have given an example of background information that does not help me personally to interpret the song better.
so the answer to your question is it depends on the information, and the singer.
here is another example, the song tam linn, i was singing this song well and receiving applause and praise for singing it long before i knew it was a piece supposedly crafted by a l loyd, that information has not affected my ability to interpret the song better or worse, it makes no difference whatsover.