So, I met with a few other writer friends today, and we got talking about characters in situations with which we, personally, might not be familiar. For example, I know nothing about New York. Hence, I know nothing about what life is like there, nor what trains run in the subway, what slang people use, what neighbourhoods are there. I might want to set a story in New York, but I doubt I could do so and make it believeable to New Yorkers.
Tiny, tiny things make up the cultural narrative in any distinct area, and what may sound fine to a outsider would be jarring to a native. One of my friends - let's call her Duri - is writing a story set in Ireland. She's English, however, and although we speak the same language, it's not quite equivalent. We use different phrases or wordings; she says, 'I feel ill', but I say, 'I feel sick'. I notice immediately when the things her characters say don't sound properly 'Irish'. If I ever set a story in England, I've no doubt she could point out exactly where my characters say things that are not properly 'English' - and that's before I delve into the regional dialects that are far more pronounced than the various Irish accents.
I've no doubt that people can indeed write stories that are set outside the settings familiar with them, but it certainly adds an extra level of difficulty to the job. The ideal situation is, of course, having a native of the culture present who can proof read and point out corrections; the next best thing is actual experience of the culture, then after that, extensive research and analysis.
I've noticed some writers have a real talent for it. Another friend - let's call him Shanks - wrote a suberb WWII-alternate-history short story a while back, and both Duri and I had a chance to read it. I'm reasonably sure Shanks has very little first-hand experience of modern England, but his particular forte is characterisation and dialogue, and the story (set in the wartime English countryside) felt very, very authentic to me. Duri agreed that it felt authentic to her as well.
Part of the reason I prefer fantasy or sci-fi settings is because there is generally no question of disbelief. I am in complete control of the cultural narrative, and the reader must accept what my characters say. The only question is maintaining consistency, so that characters from the same cultural background speak and act in similar ways.
Developing a new culture is probably one of the more enjoyable aspects of writing fantasy or sci-fi. While there is still a question of believeability, you are more free to chop and change elements from the modern world and other settings - for example, the Klingon culture from Star Trek uses elements from the Spartans of ancient Greece, but the writers were certainly not limited to that and made changes to adapt those elements to a sci-fi setting.
Anyway, where am I going with this... Cultural settings are very important to a story. Writing in a compelling setting is a huge part of fantasy and sci-fi. It's just a matter of being authentic; making the setting believeable, either in reference to the real world, or through internal consistency.
I've found that reading roleplaying books with information on world-building is very useful when I'm developing a setting. It gets you into the mindset of thinking about how and why the culture works like it does.