One problem with the simulation route is that games in the D&D lineage are usually wildly unbalanced. A, say, level 5 monster could run through endless level 1 NPCs. Also, much of the machinery of our world (e.g. commerce) doesn't really work when then there are incredibly dangerous and malevolent critters scattered throughout.

It's more about the combat model. Everyone is a fanatic who fights until death, despite any casualties their friends and allies have suffered. And weapons and other attacks are mostly harmless. They deal limited damage measured in hit points, which does not affect the combat effectiveness of the target, heals quickly, and does not leave any lasting effects.

In a different combat model, an equally unbalanced monster would avoid unnecessary fights agains groups of armed opponents. Not because it's afraid it would lose, but due to the risk of permanent injuries. Determined defenders could then try to take advantage of that behavior to drive the monster away.