Yep, I live in such a town now. It's a 5 minute bike ride downtown, 8 minutes to the downtown of the closest neighboring town, 13 minutes to the next closest. And it would be 12 minutes to a major shopping center with a grocery store but there's no safe route there at the moment - but that's not an impossible change to make!

Point is, you're right, it doesn't take that much density to make getting around without a car viable for many trips.