I think maybe the idea is that for some people, leaving Aleroth to do this and that may be immersion-breaking, just from a purely atmospheric or role-playing perspective. I guess I kinda liked its slightly claustrophobic feeling, though personally I liked escaping to the Battle Tower for a breath of fresh air now and again.
I always thought that the "and everybody died" seemed a little hasty, both in terms of writing and because we do encounter some of the citizens elsewhere later in the game. I can only think of the pig-fancier offhand but I'm sure there are others. I think that still fits in with Richard having died: if he was truly the hero that made him so important he'd surely want to escort everybody else to safety rather than simply saying "I'm important and you are plebs, bye!" At least I would hope so... even if he was a bit of a twit.
