There's this thing known as 'Fisherman's tales' ? Where those who fish exaggerate the size of their catches to impress those they talk to. I suspect the whole thing started something like that.
I'm not sure about Nessie. But at the side of Loch Ness is Boleskine House where evil Aleister Crowley lived before he died in Hastings. Maybe he had something to do with Nessie.