I am not actually a historian nor have I read the biography of J. C. Daniel by Chelangott Gopalakrishnan.
But as a regular movie goer and based on my research, what I can understand is that it is a movie which has got some facts wrapped up in fiction.
It appears to be an attempt influenced by the movie Harishchandrachi Factory (which was Indias official entry to Oscars in 2009), except for the political events depicted in the movie. There have been an enough discussions on the historical accuracy of the movie regarding the depiction of former Chief Minister of Kerala, K. Karunakaran and famous writer Malayatoor Ramakrishnan.
Several prominent historians and writers like D. Babupol and N. S. Madhavan have come out openly citing the inaccuracy of portraying Malayatoor and K. Karunakaran in a wrong manner.
Also the plot in the movie about actress P. K. Rosy is based on the biography written by Vinu Abraham 'Nashta Nayika'. You can read more about Rosy here.
Whether historically accurate or not, the movie Celluloid was widely accepted as one of the finest craft produced in Mollywood in the year 2013.
Some interesting facts on J. C. Daniel can be found here. Also, find the original version of the speech of Harris Daniel shown towards the end of the movie here.