The genre we'll be tackling goes by many names -- 'Fantasy and Science Fiction' is one; 'Speculative Fiction' another. It's an old genre, stretching back to the earliest literary texts, and yet still, for some reason, one that's been frowned upon in modern times by 'serious' literary thinkers and creative writing professors. One of the latter, an old friend of mine, always liked to begin her CW course with a simple admonition: "No Hobbits!" Which may seem odd, since she was and is a huge fan of Tolkien; her aversion likely had more to do with not wanting to read a stack of creative pieces which, in addition to their other issues, were set on strange new worlds.
But the larger bias -- the feeling that Fantasy and Sci-Fi (and here we could include comics, graphic novels, and much of the rest of the geekazoid literary universe) are somehow juvenile, somehow not quite suited for grown-up readers, somehow lesser than 'literary' fiction -- is still out there. Sci-Fi has its own awards (the Hugo and Nebula), but Sci-Fi and fantasy writers rarely show up on the list for any major literary awards, unless they're for children's literature. Some noted writers have dabbled in it -- Doris Lessing with her Shikasta series, or Margaret Atwood with The Handmaid's Tale and Oryx and Crake -- but they were both established writers before they did so. Atwood, pointedly, does not like the phrase "science" fiction -- she prefers "speculative" -- because, as she puts it, her novels don't have "things in them that haven't been invented yet."
And to be sure, plenty of old-school sci-fi was filled with those kinds of things, sometimes (it seemed) at the expense of character development. How many rocket ships, lasers, ant-gravity rays, or cyborgs do we really need? In the fantasy realm, hobbits, despite their charms, have done great damage; everyone wants to imitate Tolkien, but it's been a practice with diminishing returns, from Sword of Shannara on downwards.
But just because the setting, the characters, the geology, climate, and perhaps even the physics and the power of a world and its inhabitants are different from our everyday reality doesn't make them unrealistic -- indeed, it adds all kinds of other possible dimensions. Ursula K. Le Guin, who's spent a lifetime writing in, and defending, the Sci-Fi/Fantasy genre, referred to its authors as "realists of a larger reality" in a widely-reported speech she gave last year at the National Book Awards.
Some years ago, she put it even more forcefully, in her essay "Why Are Americans Afraid of Dragons?":
For fantasy is true, of course. It isn't factual, but it is true. Children know that. Adults know it too, and that is precisely why many of them are afraid of fantasy. They know that its truth challenges, even threatens, all that is false, all that is phony, unnecessary, and trivial in the life they have let themselves be forced into living. They are afraid of dragons, because they are afraid of freedom.