@Tearsax The Red-light District looks that way because the government purposely keep it like that. If you go to Japan now and visit Gion, the Geisha district in Kyoto, it still looks like an old town with all people there wearing kimono. And also in this Taisho era, only the big cities were modernized. In Japan, there are a lot of old towns that look completely like they are stuck in Edo period.
You don't remember Tanjiro groups were chased by the polices because they carry katana at the start of the train arc? They weren't chased before or after that because they traveled in mountain regions where there wasn't any law enforcement there. Normal civilians wouldn't want to go to the police to report something that wasn't involved them.