Acheologist discovered "another" Bethlehem

When news was slow over Christmas, a spate of newspapers ran one of those "here's an interesting little factoid" articles about a Israeli archaeologist who dug up a different town called Bethlehem in north Israel, quite close to Nazareth and said "hey, I wonder if the bible story about Jesus' birth is about this one, not the one at the other end of the country".

I was sceptical that Jesus was born in any Bethlehem, but I didn't know enough biblical history to know either way. Here's my understanding of the history, can anyone fill in the gaps?

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