I think your approach smacks a little of bad-wrong-fun. Telling designers they should feel bad about using milestone based levelling.
The style in Rime advances the timeline. If the players complete 3 (or more if the DM decides, it is only advice after all) the PCs stop gaining XP because the work they would be doing is no longer a challenge, no longer tests them, and therefore no longer provides development. You may think it’s cool for PCs to spend valuable play seasons defeating seriously under leveled challenges. My players would find that boring... as would I. Diminishing returns to zero for low CR challenges was quite common in 3e. I miss it. Your suggestion about players running around the Ten Towns completing the starter quests is the South Park episode when the boys kill sheep in Warcraft to level up.
The action in the ten towns also moves on, with some towns bitter that the Party didn’t help them in time. A DM could easily leverage this with rival adventuring groups, changing loyalties and displaying the consequences of PCs inactions. It’s a horror themed campaign. You aren’t supposed to help everyone with everything. That approach is naive.
There are more pressing challenges facing the Ten Towns, that a DM can present in such a way as to interest and excite the party. That doesn’t stop the party still helping the towns as side quests for favour, treasure or their own desires.
At the end of the day they have written for a typical groups progression. If you want the players be rewarded for exploring all the towns then slow down the milestones, or cut something later on, or extend the level range of the campaign. You can choose to provide whatever XP method suits you and your group. There is no need to criticize other people’s preferred methods to the extent you have.