So...literary fiction and other fiction can both make you think, but literary fiction is more deliberately encouraging discussion about it? So sort of a social commentary thing. Scifi can be hard or soft -- and actually, shows like Star Trek are able to cover moral discussion a bit more freely than ones set in the real world, because they don't have to deal with "well you're showing discrimination against X" or all the complicated censor issues that can come into play. There's one ep of the original series where there's these guys with two-color faces, and they loath the other type, and the Enterprise folks go "but you both are the same, half one color and half the other. Then the guy goes "Yeah, but he's white on the /right/, and I'm white on the /left/." Separation from reality lets you present issues in society from a less biased perspective, independently of many preconceptions. I'd also say that how rooted in reality something is will be more a function of believable characters and consistent rules for the world, and less a matter of magic and future tech. Yes, you'll negate certain specific situations with different possible actions (trapped underwater? Cast a spell that lets you breath!) but with literary issues they definitely can still apply.
Hm, in writing, sometimes hiding details can add more to the story. If a character is angry, and there's no obvious reason, then this adds tension to the scene, instead of coming out and saying how this and that happened to them in the past and it affects the way they see things. That part will come out later, when the issue is resolved, or at least discussed. It's possible to create tension by giving that information and showing the reaction, but which way I personally would go with generally depends on which character is the dominant perspective. If the perspective character is aware, then I'd include it. If they're baffled, then I won't.
Hamilton is the Broadway musical about Alexander Hamilton and Revolutionary era America. It's got some pretty awesome songs, and the language is clever. Check it out if you have a chance.
Characters don't exist in a vacuum. To understand why they interact with the world nd even other chars as they do, you need to know about the world. In fact, the world is essentially a very complicated character, at least to my mind. Possibly even more important.
@Shoryu Magami