Thanks! Yes those factors must be taken into account when tackling such questions as these. Oftentimes, we complain about such superfluities as the amount of citizens in a town. Meanwhile we often forget to take into consideration the the Wii's capabilities and other variables surrounding that. I think there's a very logical excuse for many of those things. We just need to view things from a game developer's perspective. I'm sure we'd be surprised...(sarcasm) Yes, Skyloft is only an island of very few people after 1000 years of being in the sky. Come on, there's only that many because of design purposes. If they made the land as huge as it really would have been and put in the amount of people there would really be, the disc wouldn't be able to fit it all. The Wii's memory would crash. It doesn't have to be directly logical. It's one of those things that doesn't matter.
It is always this way when it comes to adventure games. Things we don't see do not exist, right? It seems as though we are wired to think that way. But we must remember: Yes, Skyward Sword is a video game. It is not real. There are aspects of realism that are sacrificed - when developing video games - for the sake of gameplay and other variables such as fun, accessibility, and efficiency. As such, many things are intentionally left up for the player to assume. For instance, you [the OP] asked a question about Skyloft's plumbing system. That was a very minor detail that is best left out, and how it actually works can be summed up with a bit of imagination.
Hmm... Let's see. One can easily envision an intricate plumbing system running underground in Skyloft, so it is not hard to imagine where the waste is dumped. I mean, they live in the sky - in a place where the citizens didn't even know a "world below" existed. ...think about it. (loljk) To the point: As you can see, simple assumptions, like the example I've provided, can (and in some cases should) be drawn to explain the many other diminutive details in SS, such as Skyloft's food source. There is no rule against it, and it is actually encouraged by Nintendo.
To be honest, Skyloft doesn't seem that big a place, a town of about 30, a graveyard for 9 and just 1 boarding school. So does this mean everyone, with obvious exceptions being Beedle, Pumm and Kina, come from here? Just these people?
We can assume there's more. If you take into consideration what I mentioned above about how some aspects of realism are sacrificed for things like fun, accessibility, and efficiency, it is not a crime to assume Skyloft is bigger than it seems (in game) in terms of population and size. You could even assume there are more tiny settlements on islands like Beedle's that we don't see in the game.
This also got me thinking about something Levias says about Link's parents. Namely, where exactly are they?
Likely dead, as in every Zelda to date. A fan who has at least beat 5 games in the series would know that.
Is there another island we don't see in the game where more people live or where Link and Zelda grew up together? Is this really the only place in the sky where our humans come from?
See first question.
If so, are they all related in some way and where do they even get their food?
Yes. If you converse with the citizens, many of them will tell you their relation to another person in Skyloft. As for food sources, we can assume pumpkins are a major delicacy. There are also the Sky Octoroks. It is also not hard to imagine some other kind of fauna on other island from which the Skyloftians hunt for food.
Where does the waste go when Link uses the toilet?
Used in example.
What happens when more than 9 people die, are their bodies dumped over the edge? Do they use the smaller islands for burials?
We can assume they make room elsewhere for more burials. Heck, who's to say there isn't a small island out there somewhere in the sea of clouds for burials?
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