I'm not too sure about the terminology you're using... I think that Middle-Earth was created by JRR Tolkien, and not discovered by Bilbo Baggins. But that's just me.
I definitely know what you're getting at though, when comparing JRR Tolkien with other fantasy or science fiction, and also with real myths and legends. The Lord of the Rings might take place in another world, but the story concentrates on what happens within this world. We discover Middle-Earth through the eyes of the hobbits, and not through the voice of a narrator (even in The Hobbit, the narrator concentrates more on characters than locations).
Almost without exception, other sci-fi/fantasy works make up a fantastic world that is so different from our own, it needs to be explained at great (sometimes exhausting) length. The authors are too busy saying something like, "Wow! Look at this - talking dragons!" or "Flat world - how fun!", that the story usually ends up being reduced to, "By the way, there's also some characters and they do fairly predictable stuff."
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But Gwindor answered: 'The doom lies in yourself, not in your name'.
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