Historically, the vast majority of people in Europe would live in a village, and lived and died within a radius they could comfortably cover on foot in half a day. The urban population has only recently risen about 50% worldwide[1] (but that includes slums).
[1] http://www.who.int/gho/urban_health/situation_trends/urban_p...
I come from a (tiny) country where the population lived in such small villages. Village were built around a church which would be richly decorated - paid for from inheritances of gold, precious jewellery and money left by rich and poor villagers alike.
The difference between villages, towns, and cities was the scale of the patronage and the riches. Even tiny village churches would, over hundreds of years, acquire highly valuable paintings and gold and silver works of art.
Been to a European city lately? At the centre of each you will find cathedrals and palaces, as well as churches dotted throughout. High culture was indeed part of the common conversation.
Fine art was financed by aristocrats to showcase their power and status and what better way to demonstrate that status than by plonking it in the centre of town for all to admire.