Whilst I agree that there are parallels with the PoL setting in history, the fact that you have monsters running around makes a serious difference IMHO, and this is something that needs dealing with. I want isolated Inns to be credible in my world. With monsters, this is difficult and needs something more than "the village is well armed". This might be OK against Kobolds but how about big monsters, like a giant?
Now I know that people will say that monsters are rare and that they may not necessarily attack PoLs etc, but the fact remains that, because of the way the game is played, they are NOT that rare. For example, at high level, players could be encountering 4 large groups of monsters in a 24 hour period. If this is extrapolated to the world, this means that there are alot of monsters.
Take for instance, a single adult Dragon. Such a creature, if actively trying to acquire a hoard, could level cities and towns across an area the size of a continent. Villagers, no matter how good in combat are not heros and nor are the town guard. Since one of the conceits of PoLs is that adventurers and levelled classes are rare, this takes away the idea that all settlements are overflowing with spellcasters etc.
So how do we build realistic settings given these constraints?