Earlier quoted context omitted.
Basically entire Europe was a warzone from the end of the Roman period to... oh, Ukraine.. well, Europe still is a warzone but much less so now than in the past centuries. The middle ages wars didn't really involve the population. They were more a matter of aristocracy. Cities were raized, since those where the way to control land, but you generally left the peasants and their lords alone. Peasants really didn't care…
> wars mostly affected the 'state' and not the people that much How do you exactly think armies are fed, armed, and paid? There are innumerable examples of revolts ignited due to the abuses of the local or occupying army. This idea of "limited" warfare where a king took a few men and fought it out with his rival with the population not caring or suffering much is utterly deluded.
The Grande Armee marching across Europe would have made a huge impact to the zone within a day's ride of it, and much less outside of that. It was the 20th century which made giant fronts and mass bombing of civilians behind the front possible. Not that previous war was without its atrocities (Magdeburg), but the scale was proportionally smaller.
And, yes, tax and fiscal policy was completely dominated by warmaking related costs. As the state was much smaller and had little remit outside that.
"Nationalism was not a concept yet" also deserves looking at; the map looked very different, with either huge loose polyglot empires (Austria-Hungary, HRE) or smaller monarchial states, and the idea of self in the world that people would have had looked very different. Especially for much of the middle of that period it was bound more to religion.