According to a note on the first page of (v2) #1, "These events occur between Incredible Hulk #181 and Giant-Size X-Men #1." The first storyline ostensibly details the hitherto untold first meeting of Wolverine and the Beast.
Captain America #175 (Jul 74) - Secret Empire defeated
Marvel Team-Up #23 (Jul 74) - Iceman and Human Torch
The Defenders #15-16 (Sep-Oct 74) - Blob, Unus and Mastermind reduced to infancy
Incredible Hulk #180-182 - Oct-Dec 74) - Wolverine vs. Hulk
Avengers #137 (Jul 75) - Beast joins Avengers
Marvel Team-Up #38 (Oct 75) - Beast and Spider-Man
Giant-Size X-Men #1 (May 75) - "All-New, All-Different" team
X-MEN LEGENDS (v2) #1:
The first four-and-a-half pages lead into Hulk #182, page one.
Half of page five and all of page six retell the Hulk #182 splash page.
Page seven equals Hulk #182 page 2, page eight equals page three.
So, how do these eight pages compare to the original three? First, it's been completely rewritten: some lines of dialogue have been dropped, others added. Second, the "voice" of both characters, particularly the Hulk's, is noticeably different from 1975. Third (and this bugs me more than the dialogue changes for some reason), when the Hulk goes leaping away, the sound effect is "BOUND" "BOUND" "BOUND" rather than "THOOM" "THOOM" THOOM." I don't know whether to lay this discrepancy at the feet of writer Roy Thomas or letterer Joe Caramanga or editor Mark Basso, but it illustrates to me a complete lack of effort in trying to make this interstitial scene blend with the source.
THE PLOT: When Wolverine gets back to base he is given his next mission: "We just learned that, till two days ago, the so-called Secret Empire was holding captive no fewer than nine 'extra-normals,' in its southwest desert. They got free somehow--and we've tracked at least two of them to Long Island, outside New York City. Your mission is to bring those specimens to us."
The nine "extra-normals" in question are: Beast, Iceman, Angel, Havok, Lorna Dane, Unus, Mastermind, Blob and Mesmero. Setting aside how out-of-date this information gathered by Canadian intelligence may be, two days is two days, so at the very least we're asked to accept that Hulk #180-182 happened before Marvel Team-Up #23 and Defenders #15-16. Okay, that's not too big of an ask after 48 years, is it?
Wolverine is paired with Jack Winters, a.k.a. "Jack O'Diamonds" from the "X-Men Origins" back-ups of 1968. (Yes, he supposedly died in X-Men #42, but so did Professor X.) They are sent to infiltrate the Brand Corporation headquarters on Long Island, which I can accept. Hank McCoy was still working for Brand up until he was abducted by the Secret Empire (as revealed in Captain America #174). Inside they encounter all of the previously abducted mutants except the Beast (and Mesmero). Again, that's okay if we're going to accept the premise that Hulk #180-182 occurs between Captain America #175 and Marvel Team-Up #23.
X-MEN: THE HIDDEN YEARS: Remember the 1999 series X-Men: The Hidden Years? I had high hopes for that series. It was announced at the same time as Spider-Man: Chapter One, but John Byrne wanted to complete that series first, before beginning work on Hidden Years. Whereas Chapter One was a retelling of Spider-Man's origin (unnecessary as far as I was concerned, then and now), Hidden Years was to have filled in the gaps between X-Men #66 and Giant-Size X-Men #1, fleshing out the "stories behind the stories" of the X-Men's appearances, as a team and solo, in other titles during this time frame. If it had been allowed to play out, it would have provided detail behind their decision to revert to their original uniforms, their capture by the Secret Empire and so on.
Unfortunately, having dithered away a year (13 months including a "zero" issue) on an unnecessary (again, IMO) rehash of Spider-Man's origin, Byrne never even got to that point by the time EIC Joe Quesada axed the title prematurely, while Byrne still had stories left to tell. Quesada's reason? He thought having an X-Men title set in the past would have been "too confusing" for fans. I think he should have cancelled every mutant title except Hidden Years. Anyway, by including the Secret Empire backstory in issue #1, Marvel may finally be getting around to telling the story I've been waiting more than 20 years to read.
SAVAGE HULK: Back in 2014, Marvel released a four-issue series by Alan Davis set immediately after X-Men #66. Although it contradicted the early issues of The Hidden Years to some extent, I really liked it because it was by Alan Davis. OTOH, it contradicted established continuity (in regard to the Abomination) and could not be made to fit, not no way, not no how. The contradictions of X-Men Legends #1 are not nearly so egregious, but whether I come to accept it or not will depend a whole lot on how the story plays out. I can be a lot more forgiving of lapses in continuity if I like the story itself. But Roy Thomas coined the term "retroactive continuity" and I expected a bit more from him.
Last month it seemed as if X-Men Legends #1 violated continuity slightly, but within the first three pages of #2 something happens which reveals that is not the case. X-Men Legends #1-2 does not violate continuity. the story itself may be apocryphal (that's up to each individual reader), but it does slot nicely between Hulk #182 and Giant-Size X-Men #1 (or Captain America #175 and Avengers #137 as far as the Beast in concerned). In canon, Wolverine and the Beast catch their first glimpse of each other (across a video screen) in X-Men #94, and meet face-to-face for the first time in #111. I was prepared to cite either or both of this retcon should violate those meetings, but it ends up being a moot point because Wolverine and the Beast don't really meet face-to-face in this story, at least not while both are conscious and.or undisguised. (In that way, the cover is somewhat deceptive). In his story, Roy Thomas also accounts for Wolverine's change of mask style and his different C.O. between his first two appearances, as well as ties up a plot thread left dangling from the Beast's solo series in Amazing Adventures.