I think that there is significance in the story's setting being unnamed. There is a distinct feeling that the story could happen anywhere. This is enhanced in how the town is regular and nothing distinctive. The setting of the story could be anywhere. In naming the town or the region where it would take place, barriers are constructed from the reader fully understanding and appreciating it. In the town being unnamed, there is an open application. This is the setting in which Mrs. Strangeworth lives. Its lack of specific description makes it more applicable to the reader's own background and setting. In this respect, Jackson's "unnaming" of the town helps to provide an immediate connection to the setting.
In its own right, the setting is highly significant to the themes of the story. It is a small town. This is significant because it helps to increase the likelihood of how Mrs. Strangeworth knows everything about everybody, fueling her small notes. At the same time, the town's size is significant to Mrs. Strangeworth. Had the setting been a sprawling metropolis, it would be less likely that she would not wish to control and stop "the possibility of evil." She only wishes to do this because her town is so small and something that she feels she can control. In these, Jackson's setting is significant to the development of the story in both thematic purposes and its applicability to the reader.