I think it would fall apart because of constant debates over CITH vs. COTH, veiling, women wearing slacks, and chant vs. hymns in the Mass.
Seriously, folks, Evangelical Protestants do it all the time. It’s called “fortress Christianity,” and it doesn’t work the way real Christianity is supposed to work.
Instead of a “Catholic Town,” why not a Catholic recreational community? Years ago, when my husband and I were in college, the college pastor in our home church took a group of us to a place in Illinois called Bethany Beach (on Lake Michigan). Only Christians lived there. I believe they were mainly Evangelical Protestant, because I remember that there was no liquor use allowed, no bars, no restaurants that served liquor, and no stores that sold it. All the music played was “Christian” music. The suits at the beach were modest but pretty. We were able to take walks at three a.m. and not worry about getting mugged or raped.
I remember that there was just one church that everyone in the community attended, and EVERYONE in the community attended it on Sunday morning! No one stayed home to watch the Cubs play!
It was incredibly restful because we could be ourselves. We didn’t have to be “on guard” all the time, wondering if we were being “good witnesses” to non-Christians. People could say, “Praise the Lord!” and not feel like freaks. We didn’t have to close our eyes to alcohol use and pretend that we were “OK” with it. We didn’t have to avert our eyes over suggestive swimsuits. No one swore. No one watched bad shows on TV. (I remember that there was TV, but who wants to watch TV when you’re at a beach.)
It was kind of like a glimpse of heaven.
They told us that the community started decades ago, and that most of the homes at the beach had been in the same families for the entire time, and were just passed down.
I don’t know if this place still exists. Perhaps it went belly-up in the various economic downturns. Or perhaps the Christians who had homes there decided to give up “escaping” from the world in favor of being in the world but not of the world.
I know that there are various Catholic retreat centers around the U.S., and I have been on retreat at several of the shrines. My daughter went on a silent retreat at a monastery and really loved it. Perhaps you could try this, since it’s already a reality, and a “Catholic Town” is probably not likely to happen.