I think this debate is too often a false dichotomy. There's a huge range of choices between never letting kids leave your sight until they're 18, and letting them ride a subway by themselves at age 9. Parents are currently leaning on the cautious side, there may be downsides, but I don't think it's some great tragedy.
I agree, it doesn't seem that extreme to me. Maybe something like letting your 9 year old get on a bus to another state, without a phone, and telling them "come back when you're done having fun!" would be extreme.
My grandfather did this with my father - though with specific marching orders. Regularly, maybe starting when dad was 7. It was the 1920's (s/bus/train/g). So far as I can tell from old family stories, it was considered pretty normal for an extended family with farms that were hundreds of miles apart. When school was out, the "free" young farm labor could be sent to where there was work that needed doing.