As for "medieval" romance, I would say there is nothing medieval about it. It's just feel-good fiction that has been around since stories were first invented, and is found in most popular fiction, irrespective of dragons.
From what I know about 'stories', they tended to be warnings and often horrific. Stories around ancient pantheons tend to be not all that great. Something like Beowulf I wouldn't call a feel good story, nor would I call the original fairy tales all that kid friendly either...
Imho you have fantasy works where the past was truly better, and where the past is now viewed by certain people as better, just like in real life. When people these days talk about the past they tend to forget the cold war and the nuclear threat, the post war rebuilding, heck even the war era itself. And that's just the really big stuff, the countless smaller stuff that people forget is staggering. But that's how memory tends to work, unless it's truly traumatic.
What about Lord of the Rings? Sure the Elves are in decline and certain Kingdoms have corrupted rulers, but when you read about the earlier ages, things were certainly not better (for everyone). The Hobbitses lead idyllic lives, only when the start messing with the One Ring and move outside of the Shire do things turn ugly... That One Ring had been around since the Second Age, LotR is in the Fourth Age...
And we often see it on a much smaller scale, where the protagonist has a decent childhood that turns ugly and their village is destroyed, family killed, etc. Life before that event might have been hard, but it was better... For them...
