Not if you're not doing odd jobs exclusively and at a rapid pace, taking time to thoroughly explore the town you're in or what have you. I set it to 5 because the traders are part and parcel of the game, even though I've playtested without them altogether, but am not particularly enamored of the odd jobs that aren't quests. You can level just fine without doing any and find or craft everything you need without ever buying or selling from them for the most part. Just takes a lot longer, but I've left the option there most of the time because some do those odd jobs exclusively; others do them just to get the bike, then go off and do whatever they please; others.... Well, you get the picture. It's a pretty arbitrary number in that regard. If you speed through a playthrough rather than taking time to smell the roses, so to speak, that's on you.
And, of course, it doesn't have to be set to less. It can be set to more if doing odd jobs to level is your thing. It's not exclusively tied to leveling, so I'm not sure why there isn't an option to set it on the main menu, but there must some reason to which I'm not privy.
I kinda like the idea of less quests per tier.. one of the main reasons I end up grinding quests is that you'll need to do your 50 before getting to the challenging ones. If I can drop that to ~20, I might postpone it for later.
Well, yes and no. Yes, some might raise it, but it wouldn't be because of leveling. You can do as many quests at any tier as you want to already, so there isn't any change to leveling if you raise it. Instead, they might raise it just to slow down the progression to higher tier quests. Unfortunately, that isn't really a great option because you'll level up even when not doing the higher tier quests and be out-leveled for your tier, making them quests even easier than they already are. I suppose if you decrease your XP gain setting to match, it might work okay, though. But either way, it wouldn't impact leveling. You can complete all the quests you want regardless of how many points you get towards completing a quest tier.