What happened at Little Bighorn? A narrative that demystifies Custer's last stand; Son of the Morning Star: Custer and the Little Bighorn, by Evan S. Connell. San Francisco: North Point Press. 441 pp. $20.

Truth, no matter how startling, customarily rings with a distinctive note, rather like the high hard ring of a silver coin dropped on a table.... - Evan S. Connell

Now we have the story of Gen. George Armstrong Custer as Flaubert would have written it. Like ''Madame Bovary,'' it is the demystification of a romantic type. Since that type gets at the heart of what it means to be ''American,'' this telling of the tribal tale is likely to offend some people. It is, nonetheless, a great book. Evan S. Connell, a ''mere'' novelist, emerges as a great writer.

''Son of the Morning Star'' is not a novel. It is a painstaking reconstruction of what might have happened, and why, at Little Bighorn on June 25, 1876. Within a general structure - A B A, from battle back to beginnings up to the battle again - the book, whose 422 pages of narrative are still highly compact, is a series of digressions.

Connell attends minutely to the significance of such things as hair (scalping as well as Custer's long blond locks), the origin of the aphorism ''The only good Indian is a dead Indian,'' and luck. Woven into the stream of digressions, eddying pools that advance the flow of the prose, are asides, tentative but often of the essence. For example, when a string of a hundred Cheyenne scalps was displayed at the Apollo Theater, a witness claimed that the audience ''applauded rapturously.'' Connell notes, however, ''If the audience did applaud it surely validates the comment of a visiting Britisher that America might be the only nation in history to have slipped from a primitive estate into decadence without ever knowing civilization.''

That possibility haunts the dense, extremely vivid pages of ''Son of the Morning Star.'' Custer's widow, Elizabeth, complained in 1927 that, while President Grant did not take formal notice of the tragedy of ''Custer's last stand'' when it happened, President Theodore Roosevelt later proclaimed the general ''a shining light to all the youth of America.''

Demystifying Custer is an act of charity. Of course, some people reject charity. But it is charity that motivates this astonishing book.

Connell has a real feeling for Custer. Custer is one of those ''adventurous people who refused to spend their lives behind fences.'' The general felt an affinity for the Indians he was paid to ''control.'' ''He liked their courage and passionate independence,'' Connell observes. These qualities Custer shared with the native Americans; they are a part of America's self-image.

Unlike the romantic James Fenimore Cooper, Custer knew the Indians firsthand, and he thought them savages - but ''not worse, perhaps, than (their) white brother(s) would be (if) similarly born and bred...,'' Custer wrote when he was a West Point cadet. Custer loved to fight. He enjoyed the Civil War to the hilt. Connell comments on an 1863 passage by Custer about ''glorious war'': ''Those words radiate from a mind of a bona fide nineteenth-century American romantic, cameo pink, nourished on sentiment, the immaculate product of his age.''

And Connell shows again and again Custer's feelings of closeness to dogs and horses, mice and birds. His men knew him to be cruel, however - wanton in his punishment of them for even the slightest departure from the rules.

What happened at Little Bighorn? Nobody knows for sure. No whites survived. Connell gives us a very plausible scenario, based on his understanding of Custer. The general was depressed going into the battle; his fellow officers and many of his soldiers were scared. Though scalping wasn't necessarily fatal, they had been schooled to believe that, if they were captured alive, torture would inevitably follow.

Because of the history of broken treaties, the Indians, for their part, had no reason to trust whites. The ingenuities of hatred were refined by contempt, as the Indians got to know the whites better during the Indian wars.

Using axes distributed by the government to ''agency'' Indians who were paid to keep their place, the Indians mutilated the corpses of Custer's troops. ''They could not understand why soldiers pursued them when all they ever wanted was to be left alone so that they might live as they had lived for centuries: hunting, fishing, trailing the munificent buffalo,'' Connell writes.

Hardened by war and faced with ''the immense emptiness'' of the plains, which they felt it was their divine right to appropriate, Custer's Seventh Cavalry acted at least as savage as the savages. For his part, Custer, faced in 1876 with an assignment to clear the land of Indians and make it safe for the railroad, had a reason to hurry. Not only was the Philadelphia Centennial Exposition about to open; it was also an election year. Connell, whose portrait of Custer is extraordinarily full, speculates that the general's belief in himself extended to the White House. Custer wanted to be president.

One of the best books of the year.