American Realism emerged in the late 19th century. Realism in America was quite varied on account of it being a young country still finding its way. However, Realism was a shift from the idealism of Romanticism and Transcendentalism to more pragmatic, real, and true depictions of American life. This would include more literature about the lower classes, sociology and psychology, sexuality, and industrialization. Since America was growing, there was also a branch of Realism some might call "Utopian Realism." And in response to your question, the West has always represented hope and the myriad of possibilities of resources and opportunities of a new, yet undiscovered frontier.
There are many reasons for this. One obvious example is the gold rush in California during the mid 19th century. In 1865, Horace Greeley wrote "Go West, young man, go West and grow up with the country." It is alleged that John Soule wrote this phrase first but Greeley popularized it. Greeley saw the possibilities of settling in the West. He thought the atmosphere and society in Washington was corrupt and the West represented a young, innocent land, capable of being cultivated into a prosperous society. He also paralleled young men's youth and idealism with the hope and promise of this relatively new, wide expanse of land.
There is also the landscape of the West. Once you get past the Appalachian Mountains and into the midwest and southwest, it is wide open spaces, perhaps an indication of the wide open possibilities therein. Also, this landscape was very different from the East coast, so it literally (geographically) meant different opportunities in terms of settlements, agriculture, and resources (gold, oil, etc.)
Fast-forward to the current era. Like it or not, Hollywood still represents hope and possibility, to go West and become a star. Beginning just after the Civil War and leading up to today, the West has represented adventure, possibility, and even now the chance for prosperity and fame.
Going West is part of American Realism but also somewhat of a reaction to it. There were practical (real) reasons for going West but it was also an idealistic adventure.
The term "Manifest Destiny" was used as a political catch phrase to encourage expansion. It was also used as a spiritual ethos that America was destined to expand. And later it had been appropriated in other ways, including the idea that America should "expand" its concepts of democracy around the world. The move to expand in the West in the 19th century represented an opportunity to begin the world anew (despite the fact that Native Americans had already been there). "Beginning the world anew" had and will always have personal, social, and spiritual motivations.
Some critics propose the Realism performs a social function, focusing on the plight of rural and urban life, social and personal life. Going West was part that reality but also symbolized a potential escape from it to something better.