The Problem with the "Realism" Argument When Discussing Fantasy

I’ve read many posts about the nature of historical accuracy and the portrayal of female characters and ethnic minorities when it comes to fantasy. One party wants more female and minority characters in fiction and wants them included regardless of context, while another party doesn’t care about the portrayal of female and minority characters because of historical context. Yet despite their opposing views, very often both sides will use the same claim to bolster their arguments:

“It’s fantasy! You have no problem with dragons and magic, but you don’t want people of color in your medieval European fantasy setting?”

“It’s fantasy! Why are you complaining about white actors playing these roles when this world doesn’t take place on Earth and there are dragons and people with superpowers?”

Both sides use the “realism” and “fantasy” excuses. Opponents of racebending and whitewashing have told supporters of the film “The Last Airbender” that it doesn’t matter that the world of Avatar doesn’t take place on Earth and features magic, since the societies depicted were clearly based on Inuit and Asian cultures. Therefore, they don’t believe in the “it’s fantasy” argument when it comes to justifying the film version’s whitewashing. However, Social Justice Warriors (SJW) who want to see more female and non-white characters will often use the “it’s fantasy” retort when arguing with fans of fantasy fiction that takes place in settings clearly inspired by medieval Europe, such as J.R.R. Tolkien’s The Lord of the Rings and the Disney movie, Brave. Their argument is that neither story is “realistic” because both contain magic and fantastical creatures, so why does the ethnicity of the human characters or the portrayal of female characters need to be historically accurate when the stories themselves clearly aren’t? On the other hand, some will argue that there really were non-white minorities in medieval Europe during that time period and so it is historically incorrect and racist to not include non-white characters in such settings.

Yet for all of this back and forth bickering, both sides seem to miss the point. In the end, despite all claims of fantasy and realism, the choice is up to the author or creator. The author picks and chooses which real-world elements to include in his/her work. The author must decide how accurate he or she wants the setting to be when it comes to its similarity with real-world cultures.

( Why the "but your story has magic!" argument doesn't work )