In other words, is it an earth-sized sphere orbiting a sol-like star?
No. It's kind of a hollow world, but from the surface it's looks pretty much like earth.
Generally speaking, do the rules of physics of the real world apply to your fantasy world?
If so, why?
Yes, because there is gravity, and there is a distortion of dimensions toward the center of this hollow world (comparable to black holes in the principle).
How do you feel about flat worlds? Worlds where the sky is actually a demi-plane hung with crystaline lanterns. Worlds where sailing east will eventually result in falling off the world. Worlds where the sun is actually a burning ship drawn across the sky each day by magic flying condors.
All these ideas are really cool, and could make really cool settings for characters to explore. I like the medieval/legendary feel of them all.
Are there worlds out there that actually reflect medieval "science" and superstition?
Your lantern and chariot ideas can be compared to
Middle-earth, where you've got first the trees, and then their fruits in the sky. In Roleplaying Games,
Glorantha, creation of Greg Stafford, once the setting for RuneQuest, now for HeroQuest and HeroWars, published by Issaries Inc, would certainly interest you, if you don't know it. It's physical cosmology is heavily based on its pantheons and mythologies. There is an inter-dependance there between what the world is and what its people believe.
Do you think it would be cool to game in such a setting, or would it strike you as "wrong?"
Absolutely not "wrong". Actually, like you, I'd like to see more original cosmologies like this.
Why do we have such a proliferation of "mundane" worlds in a magical/fantastic gaming genre?
That's an excellent question. Because designers try to make their world believable and think (whether this is true or not) gamers wouldn't go for settings that would be "too" original. Perhaps it has to do with gaming history as well. In any case, this seems like a very subjective tendency. There's probably also this "why bother" syndrom mentioned above.
I've said it before and I'll say it again: the grand details of a given world are the easiest to create. The gods, the ten thousand year histories, cosmology, contienents, dragon kingdoms ... all of these are not terribly difficult to create.
Well. Not difficult if you dismiss it from the start as being non-important for player characters...
What's hard is figuring out small villages and figuring out just how they've survived living next to the evil reptile cult for so long and what would persuade them to call on adventurers. The devil, as they say, is in the details.
... but I do agree that details aren't easy either. Furthermore, I think that pointing out, practically, in the text, the inter-dependance between the cosmology and the base layout (the villages, regions, people of the world) may be difficult to realize, but not impossible. Far from it. The difficult part, I think, is to emphasize it enough so that the world takes multiple dimensions all linked together in the DM/players' minds. To find the balance and the right "stimuli" or "punch lines" that create the spark, if you want.