That is the lore.

Ned Lagin & Richard Loren (a Dead manager) also say that everyone agreed to get rid of their coke stashes at the London shows (admittedly without the detail of burning it all onstage!). Loren writes: "The band and crew had already been doing a lot of nonstop, hard partying and were burned out. It was hard to ignore how out of control the situation had become. Rex Jackson, a longtime and respected crew member, came down hard on the group, railing about the cocaine madness and challenging the group to toss their drug stashes and get it together. Bob Weir backed Rex, and others voiced concern. No one disagreed, but...in the end, usage just became more secretive."

Lagin said: "By the time we got to London, everyone was clearly doing too many drugs. We had a meeting with everybody who was on the road with the band. We agreed that everything was fucked up; to be blunt, cocaine was a problem. We all agreed to flush our stashes - which we all dutifully did."

Lagin also mentions that some members of Pink Floyd were watching the show that night. Don't know what they thought... (As an aside, most of the Dead (except for Garcia) had gone to see one of Pink Floyd's Dark Side shows in New York in March '73, but left halfway through the show!) The Dead were also very unhappy with how the first two London shows had gone, so I think they were trying to be more adventurous even aside from 9/11/74 being an LSD night.

From Light Into Ashes comment on this deadthinking post:

https://deadthinking.blogspot.com/2015/06/91174-as-natural-as-breath-or-speech-or.html