i chose fantasy because i have a lot of horror storylines dealing with the supernatural/occult. all of my sims saves exist in the same universe, so even in my happy/mundane saves those things exist.
that being said, i don't want my human sims to fly around or be invincible or something absurd like that.. and i want them to act in a realistic manner. "fantasy" isn't an excuse for bad ai/game mechanics/glitches or lack of depth. just saying that because i've seen a couple of people use "it's not supposed to be realistic! the grim reaper and ghosts aren't realistic!!" as an excuse for those things.