First of all, the architecture here is not historically correct. Based on my research, Shuten Doji is set on the Engi period. Due to difficulties finding proper references and time constraints, most of the buildings are from Edo period. Edo period is chosen because they are many references available in the internet and it still has that "old" feel.
The diorama has 3 main parts, the village, the temple and the castle. The three parts represents the life of Shuten Doji based on the folktale. The arrangement of the parts on the mountain is done with purpose.