Y is Yarn

I’ve heard of yarns and not the kind you turn into a sweater. The word is used to describe some movies and books. An in: “. . . a delightfully entertaining yarn . . .” I don’t suppose I thought stories described like that had anything in common besides being entertaining and fun.
But than I was reading The Art of Fiction by John Gardner a few weeks ago and this line stood out for me:
The yarn writer—like Mark Twain in “The Celebrated Jumping Frog of Calaveras County” or “Baker’s Bluejay Yarn”—uses yet another method: He tells outrageous lies, or has some character tell the poor narrator some outrageous lie, and he simultaneously emphasizes both the brilliance and the falsehood of the lie; that is, he tells the lie as convincingly as he can but also raises objections to the lie, either those objections the reader might raise or, for comic effect, literal-minded country-bumpkin objections that, though bumpkinish, call attention to the yarn’s improbabilities.
Also, I suppose I considered yarn a useless word that lots of movie reviewers to describe, well, movies. It never tells me anything about the movie itself. Other than that the movie entertaining and aren’t all movies supposed to be entertaining?
I’ve not read either of the stories Gardner mentions. But before I read I never really considered that there were yarn writers.
I am not even entirely sure what a yarn is. Mark Twain was popular in his own time, so all the popular books? Books where the character tells outrageous lies?
Googleing define yarn nets me this result:
Verb: Tell a long or implausible story.
Synonyms: thread – story – tale
Really, the only story I can think off the top of the head is The Warrior’s Apprentice. Miles spend the whole book telling story after story, bamboozling his enemies into surrender.
But I am not really sure. Maybe yarn really is short-hand for entertaining and fun, like I used to think.