this one one of the most entertaining threads to read yet on this forum. well done.
although I agree that the idea of arguing which made-up universe is more realistic is crazy. 40K makes no more sense than warmahordes. Warhammer just likes to at least base its unbelievability in technology (the emperor is imortal now, and has enough psychic power to influence his entire race. how? because we hooked him up to some really cool technology...) while warmahordes bases it on magic. really both are impossible. but they fit better in their respective settings.
the iron kingdoms aren't super technologically advanced yet. it's a fantasy-type setting which generally involves a bunch of magic/dragons/monsters. Warhammer is a far future sci-fi game, which means even "magical" things are explained by cool technology. doesn't make it any more believable, just different.
Paul, you even admit that a lot of Warhammer makes no sense (Nids, Orks, psykers, titans, deamons, the warp, space marines, necrons..... bsaically anything that anyone has brought up that is not a tank) but your solution is just don't play any of those ever. even if you don't play them, you still will eventually play against them though. does it make it less believable for you if you have to send your super-realistic tanks after not-so-realistic deamon princes?
if not, it shouldn't be too hard to play warmahordes. you basically just don't like the warjacks because they're walkers. but what about the Hordes factions? they're not using dumb tech, they just have very big awesome monsters who smash the hell out of stuff. I'm starting a Skorne army, and I love their background. very persian style army, except instead of riding the elephants they just send them in to smash stuff up.
Maybe I'm just not very into realistic games. I have never had any problem loving the game in spite of its odd fluff. I think I like it all because it is wonky. but then again I don't play IG because I find their fluff boring. I prefer crazy space clowns that hide in a non-material realm and come out to beat up deamons. with magic