Time in a Fantasy setting

When I think about realism in a Fantasy setting, one of the sticking points always seems to be the ages of these worlds.  Their histories tell us of thousands of years of history, cultures clashing, mighty empires rising, only to tumble and be reborn.  Prophesies are made, long forgotten, and now come to fruition.  Perhaps some of these histories stem from elaborated oral traditions, like the Norse or Chinese tales of old, but it never quite feels that way. 
    The trouble is that, after a couple thousand years, humans moved beyond a Medieval setting.  The Medieval period itself didn't last all that long.  Hell, the events depicted in the Bible were supposed to have happened two thousand years ago.  A heck of a lot happens in a couple hundred years: technologies evolve, philosophies are birthed, nations rise and fall.  To stagnate at one technological level for thousands of years would seem to require a significant effort.  
    One of the classic ways to get around this is to have your Fantasy world build upon the ashes of a much more high-tech world, ala the Sha-na-nara setting.  Magic arising from a scientific apocalypse is an old idea.  Usually the suggestion is that the magical creatures had been hiding out all along and came back to the surface once humanity wipes most of itself out (anyone else remember the animated film "Wizards," fondly?).  Otherwise you get into evolving/mutating humans (or other animals) to create Fantastic creatures.  Magic might then arise from tapping into primal energies or faiths that arise (or again had been dormant).  It works, but for me it's been done; it's a little too "Planet of the Apes."
    The interaction with other sentient species could cause a retardation of technological advances, if they are anti-science.  Elves are typically portrayed as the defenders of nature, living in am idyllic relationship with their surroundings.  If they stand up to humans who attempt to despoil the land, then they might slow the development of human society.  Then again military need has always driven scientific advancement, so conflict with another culture might accelerate the development of military technology.  Elves also tend to be smaller in number, due to their lifestyle, so this might also encourage humans to organize more efficiently to overcome any physical or intellectual advantages that the elves have.  This history could depict the slow shift in the balance of power between the cultures.
    Conflict with a group that preys on humans might limit the evolution of culture.  Humans have long been an apex predator, but what if there were a predator as intelligent as we are?  Again, it might encourage the rapid military advance, but if the other species is far enough ahead, they might have a lifestyle that represses our culture, or perhaps they treat us as cattle.  However, if they are that intelligent, the same questions would apply to them.  It could be a couple hundred years of oppression, but if humans throw off the yoke, there is no reason they would lose the technology of their oppressors and then build upon that. 
    It isn't enough to have conflict between nations.  "Like the fella says, in Italy for 30 years under the Borgias they had warfare, terror, murder, and bloodshed, but they produced Michelangelo, Leonardo da Vinci, and the Renaissance. In Switzerland they had brotherly love - they had 500 years of democracy and peace, and what did that produce? The cuckoo clock." (The Third Man ).  Human history is full of conflict, so we can see how much that slows our development.  Wars tend to build industry and to fire nationalism. 
    Magic may replace science in a setting, but only if it is universally accessible to the intelligent (e.g. not an inborn gift) or cheap to obtain.  If all of the intelligent could use magic, then there might be no one of ability interested in furthering science.  If the less gifted were the only ones interested in it, it would slow the development significantly.  Technology is so much a part of our everyday that magic use would have to be a universal practice.  Science is too universally valuable to be ignored.  That could lead to an interesting conflict between technology and magic, with magic being the power of the elite... 
   Religion and philosophy seem to be the only feasible methods of slowing the advance of technology in a traditional Fantasy setting.  The trick is that they must consciously oppose the development of science.  Most who are interested in acquiring power do not care where it comes from and will subsequently support scientific development.  There must be some kind of intentional limitation, like in Dune, where their religion does not allow thinking machines (leaving those creepy mentats).  Wait, that isn't a traditional Fantasy setting.  Oh, it's just an example of an idea, don't worry about it. 
    The bottom line is, things happen really quickly in the course of history.  Generations take less than twenty years.  If you don't write them down, things that happened in your father's day may be lost to the mists of time.  There is no need to give your world such a back-story.  Stick in a little more reality and you will see how quickly things can develop.