A prized stone set up, literally this, classically? (10)

'this classically?' is the definition.
The definition suggests a singular noun but the answer is not.

'a prized stone set up literally' is the wordplay.
'prized stone' becomes 'gem' (I've seen this in another clue).
'set up' shows that the letters should be reversed in order (in a down clue, letters go up).
'literally' becomes 'lithic' (I can't justify this - if you can you should believe this answer much more).
'a'+'gem'='agem'
'agem' written backwards gives 'mega'.
'mega'+'lithic'='MEGALITHIC'

Can you help me to learn more?