score:18
I suspect this is a misleading interpretation of a custom.
The rumbling power of the taiko has also been long been associated with the gods, and has been appropriated by the religions of Japan. According to Daihachi Oguchi of Osuwa-daiko, about four thousand years ago, in the Jomon period , taiko was used for to signal various activities in the village. Simple taiko beats would be used to signal that the hunters were setting out, or to signal that a storm was coming and that the women needed to bring in the meat and fruits they had drying. While there is no direct physical evidence to support this claim, Megumi Ochi, curator of the Taiko Kan Museum, believes this to be true since other cultures exhibit the same behavior. Because these signals were so important to the flow of daily life, the people were very thankful of the taiko, and began to believe that the taiko was inhabited by a god. TaikoResource
If the taiko drums were used to coordinate village activities in this manner, then those beyond the sound of the drum would have been less organically connected to village life. The size of the village was determined by the village's ability to coordinate and govern activities effectively, and the taiko were merely the technology of that governance. I think the original quote makes it sound as though cause and effect were reversed - that the goal was to design a village within the sound of a drum; I find it more credible that the goal was to coordinate village activities using available technology.
Another source
It is said that the boundaries of the village were defined by the distance at which the community odaiko (large drum) could be heard. This would mean, the louder the taiko, the bigger the village. In fact, some drums were made to gargantuan scale, 10-15 feet in diameter, and pounded upon by sticks the size of a baseball bat! PortlandTaiko
I think that @andrewRichmod expresses my hypothesis more clearly than I do; I'm copying it here because comments are barn cats, and I don't want an excellent contribution to be lost.
If it was useful for villagers to hear the drum, then also organically population density, property value would be higher within range, villagers would choose to live in earshot.
I'd be more comfortable with my hypothesis if I could find a primary source, or even a secondary source that I found more reliable.