This is a good analysis ! I think the reality is that most games are just that, and expecting the economics to make any sense at all is a pipe dream.

Unless you're playing Chivalry and Sorcery. Oh god... the most complex RPG ever designed. 100+ pages of close packed small print tables that enable you to simulate 12th century France in minute detail. Beautiful as a reference source, hard to play.

I'd love to see some of the mechanics you put together to make Knave work ! Perhaps what needs to be added is "day job" earnings, so that as you climb the ranks of nobility you accumulate peasants (or parishioners for priests...), and earn a tithe from each one to help keep up your shiny new castle or church 😀 Then the adventuring is just a bit of beer money on top.