If you made it through this, good job. It gets better with repeated readings.

In-Universe, I think this work is Bilbo's Tales From the Elvish (see Return of the King), as narrated by Elrond to Bilbo during his long sojourn as Elrond's guest. Possibly added to from Rivendell's archives. Can you imagine Bilbo's delight and satisfaction of having access to such a library?

Once you're comfortable with it, and assuming you read through LOTR Appendices, Unfinished Tales is very accessible and fun, and a big addition to the whole work.

Then you face a major decision: the twelve books of Unfinished Tales. This is a mighty undertaking, and at first confusing. Again, it might be regarded in-Universe as the scattered and collected legends of the deep past, from many sources, some outright contradicting each other.

Tolkien's absolute genius takes on a whole new level with this kind of approach. There is even more world building, including really detailed discussions of language, Tolkien's most awe-inspiring ability.