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If it has docket markers on it, might these letters have earlier been lifted from the public archives at some ancient date?

If that's the case, then these letters would still rightfully be the property of the state from which they were stolen.

That said, it seems to me that the burden of proof, that these archival letters were taken from the state, would repose on the state, not on the private holder of such letters.

Even if the letters are legally "official records", if they were not stolen, then taking them for the public good should require compensation.

However, something else is at work here.
This case was decided in BANKRUPTCY court. So, somebody - creditors - are trying to get their hands on the money. If the letters were sold, the money would not go to the family. It would go into the court to be distributed to creditors, and the collection of letters would be broken up.

These letters being an asset of an individual in bankruptcy, they were going to be taken by SOMEBODY in any case. What this solution does is return the letters to the State, where the public can use them, but screws the CREDITORS of the Willcox's, not the Wilcox's themselves.
If that money doesn't go into the pot for distribution to creditors, the pot will be smaller, but the creditors will still only get what's in it. The Willcox's will still be discharged of their debts at the end of the process.

If this weren't a bankruptcy proceeding, where the courts balance the interests of competing parties, the result might have been very different.

"If it has docket markers on it, might these letters have earlier been lifted from the public archives at some ancient date?"

But the point is that nobody knows how or when the family obtained the documents. There is simply no evidence that the documents were obtained improperly. Keep in mind that these were not necessarily considered valuable or historical documents at the time they were created; they were basically routine correspondence of a kind which is usually disposed of after a mandatory minimal archival period. The state's case is built upon a series of assumptions, not facts. For all we know, the state put the documents up for auction a hundred years ago and the family bought them. I'm no lawyer, I think this case is very vulnerable to reversal at a higher level.