It's a slippery slope for me. If God can alter reality, he can do things like hide fossils, go back in time and uncommit other people's crimes, etc. I've never really seen an instance of God ever taking it this far, that I'm aware of.
God does not go back in time and change things that already happened because those things that have already happened now exist in the material world. Because they were fated (predestined) by God to take place, God is not going to undo them, because that would be akin to 'undoing' His own Will, and it would be indicative that God made a mistake and decided to change His Mind; but God is infallible so God never makes mistakes. I hope that makes sense.
God can alter what was fated (predestined) to happen in the future though, since it has not yet happened in the material world. God only alters a fate that is impending (conditional), not a fate that is fixed and settled. Although God could alter a fate that is fixed and settled, since God is omnipotent, altering such a fate would cause more harm than good, and that is why God never alters such a fate.
One way impending fates are altered is by prayer and entreaty. It is important to note that God 'can' alter them, but God does not always alter them. God only alters them if it is for our benefit.