I've worked and traveled extensively all over the state. I find my observations about the culture most sharply the farther East and North that I get. The farther South and the farther West, the better.
As far as why is NJ so populated? Well... First, natives seldom leave without provocation. Second, many (like me) got stranded here by employers who paid us to come. By the way, did you ever notice that you have to pay on the toll bridges to get OUT but it's free to get IN? Hmmm...
Your assertion that talking to strangers or being friendly is seen as weird or threatening while stereotyping Southerers or Midwesterners as religious fanatics just confirms my opinions. I'm sorry, tight population or not...there are never too many people around to smile and say "Hi".
As far as diner food. If I wanted to eat from packaged mixes, dehydrated mashed potatos, canned vegetables and gloppy cream soups I would eat the hospital food at work. No thanks. Give me fresh veggies with some crunch and from gravy from scratch ANY day!
This forum is not the place to debate these type of issues. We will not change each other's opinions. You are a native and will always love home the best. That is commendable and in some ways I envy you. But the bottom line is that I wouldn't recommend this as a move for someone unfamiliar with this culture. It is a guarantee for unhappiness and regret.