From Patricia Rice:
Susan/Miranda started a thread I’d like to comment on, and I’m posting it here to keep the thread going. (and I'm playing with images, forgive me!)
When I first started reading historical romance, I was awed by the immense amount of details in books written by Anita Mills or Roberta Gellis or any number of other amazing writers. I soaked in the historical ambiance like a dry sponge--which I was. I used to research history for the fun of it, so soaking it up through fiction was thrilling. But I was fairly uneducated in a great deal of history. If there were any anachronisms in the books I was reading, I didn't know it. I read for story, for romance, for wonderful characters. I was quite happy with romances that didn't have much history. The history was just a fun bonus.
When I first started writing historical romance, I was a bit overwhelmed by the amount of research required. So I began that book in the rural area where I lived, figuring the local library would at least carry local history. I had limited resources, and this was before the days of the internet or big bookstores. I suppose my historical research was doomed from the start. 
I had too many things I wanted to read about, too little time, and too little access.
All of which leads up to my saying that I don’t mind “historical-lite” as long as it’s done well. I do mind contemporary characters in costumes. I do mind egregious errors in fact. I’m not thrilled with 250 pages of sex and drool, because I want story and characterization. “Romance” isn’t just about sex, it’s about relationships—how the characters deal with the realities of their lives and families and make the romance work. But if an author can give me those qualities I want, I don’t need to know how a mill wheel turns.
But I believe our “littlest wenchling” is correct. Today’s younger readers haven’t had the same access to those older historicals, and in most cases, they haven’t had history taught to them in schools. They don’t know the terms “viscount” or the rules of engagement. So, as writers, we have to decide if we want to write the detailed history we love—and explain it—or simply use history as wallpaper. I’m sure there is some combination in between that we can achieve, but it’s a delicate balance.
Mostly, I believe historical romance needs to reflect a different time and place than the one we live in, a time when strange things can happen, a place where the wonderful and horrible might occur. We want surprise, fantasy, horror—in other words, we want our emotions engaged. If our minds are engaged as well, that’s a bonus.
Does this mean that in the near future, we need to start separating true “historicals” from our “fantasy” romances? Or is there some manner in which publishers can indicate which type of book it is so the purists can have what they want, and the romance readers can indulge without a qualm? Do we, as writers, owe it to our readers to separate the two, or are we allowed to muddy the waters?