If the people of Iowa wished to change the caucus system because they're unhappy, they can appeal to their state parties.
As for the small town thing: since you caucus in your precinct, it's pretty much like a small town.
In Iowa, Democrats do it differently than Republicans (who just listen to some speeches and then fill out paper ballots). Democrats have a lot more back and forth. You start by going to a part of the room to stand with others supporting your candidate. If your candidate does not reach a certain percentage of the population there, you have to go find another candidate to stand with. This is where it gets interesting: people supporting other candidates come talk to you, to convince you of the merits. This goes on for a while, with much discussion and meeting of new people, until the groups are formed and the numbers for each viable candidate counted.
Actually, if you've never done this (I did it when I lived in Minnesota), it feels much more democratic in a way than just dropping in for 5 minutes to push a button or make an x on a sheet of paper, talking to no one, and leaving. It promotes great neighborhood spirit; you get to actually discuss candidates and issues. It sort of feels like real democracy in action.
But my main point is: people think that political party primaries are somehow like elections. They're not. Maybe they've come to look like it in a lot of places, but they're really still party members deciding who they want their party's nominee to be. It's why I haven't paid all that much attention to the Republican primaries: I'm not a Republican, so it's really none of my business and doesn't hold that much interest for me. When it's a Democratic primary, I'm studying each candidate and position endlessly, because it's my duty as a member of the party to try to choose wisely.
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