Certainly "realistic" fiction has its place, and is perhaps the most important of fiction, for a good realistic work such as, say, Crime and Punishment, shows us our sin vividly and inexescapably. But if all we had was the grim, logical reality of sin, we would be miserable, joyless people, and very much doomed to black death. But we know that "realism" is not all that is real; that what is not seen is "realer" than what is seen.
And so we see the need for what we call myth and religion: we see it all through man's history, from the Epic of Gilgamesh to the Odessy to Beowulf to Star Wars. Man realizes, most of the time, that there is something unseen, and he tries to explain it. But most myths and religions are not true, and only partially fulfill man's longings: for they lack a true knowledge of God, and most mportantly, they lack His Son, the Savior of man, the great King, the Captain of the Starry Hosts. And we find that, like all myths and religions, the true God does not fit within the confines of man's reason: indeed, He exceeds them, and all myth and religion, surpassing man's fallen nature. He exceeds both our reason and our fancies- His design and guidance are greater than any scheme concocted in man's mind, and His mercies and love exceed any idea any man could have had about God.
The wisdom of God is foolishness to the scholar of the age. One cannot boil it down into "realism", but then one cannot fully express it in "fairy tales"- rather, He exceeds both, but we can express His nature and truth in both. So it is unwise to throw the faerie world and its wonder out the window, for in doing so we come close to deciding that our logic decides all: and let it be known, the wisdom of the cross is foolishness to the "wise".
Personally, I can't think of any kind of fiction less imaginative or any more boring to read than that which presents situations which could happen to real people in real life. I live real life. It surrounds me. I read to escape, to experience a world unlike the one I know, which is why I read so much SF and fantasy. That doesn't mean I'm into the occult or that I am non- or anti- Christian or anything; it just means I have different tastes than you do.
Don't make so much of the fact that some people like fantasy.