That's just how every RPG is, space and distances get condensed. IRL villages also aren't a 5 minute jog from one another and have more than 30 people.
The only game I can think of that represents distances properly is Daggerfall with its 99.999% empty overworld that you fast travel over and ignore and cities with 1000 buildings 950 of which are civilian houses you never care about.
Brother, this isn't me just trying to play pseudo-contrarian like most people on this website.
Back when I played the Witcher 3 I tried just about everything to fix the combat, even this (at the time it wasn't called W3EE Redux, just Witcher 3 Enhanced Edition):
https://www.nexusmods.com/witcher3/mods/5802
But then I realized now every combat encounter is an even more tedious exercise...that happens every 10-20 seconds of exploration.
I suppose a better example would be Morrowind. Outside of the infamous cliff racers (who get easily killed by the guards, which is absolutely not the case with that White Orchard example. I tried and the guards got slaughtered to the last man by 3-4 wolves), the monster to civilized humanoids ratio is at least somewhat believeable. But as I said, a lot of this comes down to how much you enjoy the combat. I recognize those that do won't see this as an issue, but if you do, holy fuck does it make the game unplayable.
The story and characters I did enjoy.