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One small comment to the popular but incorrect Option A (i used to make such mistake a lot in the past :-D):

Based on contemporary diaries from luminaries such as Horace Walpole and Lady Jemima Yorke, records of musical compositions, and subsequent legends, many conspiracy enthusiasts are convinced they can prove that the mysterious 18th-century high-society figure known as the Count of St. Germain lived for 500 years.

A) Based on contemporary diaries from luminaries such as Horace Walpole and Lady Jemima Yorke, records of musical compositions, and subsequent legends, enthusiasts, mentioned right after the underlined tex, cannot be based on diaries/records/legends, its their findings that are based on the listed items.

Same in the movies:
based on a true story, director - director cannot be based on a true story;
based on a true story, the film - it is the film that is based on a true story, not director
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PrayasT
Based on contemporary diaries from luminaries such as Horace Walpole and Lady Jemima Yorke, records of musical compositions, and subsequent legends, many conspiracy enthusiasts are convinced they can prove that the mysterious 18th-century high-society figure known as the Count of St. Germain lived for 500 years.

A) Based on contemporary diaries from luminaries such as Horace Walpole and Lady Jemima Yorke, records of musical compositions, and subsequent legends,

B) With contemporary diaries from luminaries such as Horace Walpole and Lady Jemima Yorke, records of musical compositions, and subsequent legends used for a basis,

C) Basing it on contemporary diaries from luminaries such as Horace Walpole and Lady Jemima Yorke, records of musical compositions, and subsequent legends,

D) Using contemporary diaries from luminaries such as Horace Walpole and Lady Jemima Yorke, records of musical compositions, and subsequent legends,

E) By contemporary diaries from luminaries such as Horace Walpole and Lady Jemima Yorke, musical compositions that had been recorded, and subsequent legends,

This question, if understood well gives direct answer.

Based on contemporary diaries from luminaries such as Horace Walpole and Lady Jemima Yorke, records of musical compositions, and subsequent legends, many conspiracy enthusiasts.....

This question wrongly addresses that the conspiracy enthusiasts are based on something. This sounds illogical and hence is incorrect.

Only option D corrects the meaning.

P.S. If we understand the meaning of the sentence and then try to solve questions based on grammatical errors, we would be able to more accurately and quickly reach the answer.
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