Many cities are poorly executed design-wise. I never understood why there are areas that are not reachable by player. Usually blocked by some silly cart or other trash.
As even smallest medieval city was larger than largest city in Bannerlord, it is completely OK for computer game to adjust size to its limits. I think every sensible player understands that it is impossible and impractical to model like 10000 inhabitants town. Less is more in games.
If I was developer, I would make unique only capital cities for all kingdoms. As big as scene map reasonably allows => generally small, so it can be properly walled around and walked around. Not like now when many cities, if not all, are not able to be walked around as player hits that red wall of map border. For the rest of the towns I would be absolutely OK with one generic model per kingdom. Only difference would be some terrain differences like flowing river, background models of mountains,flora etc.