The general observation that, as population densities exist, government types are more insulated from the people and are less democratic or responsive seems to be a rough generality in the real world

I don't think that's the case. Some of the most densely-populated places on the planet include Tokyo, Delhi, Mexico City, Sao Paulo, Mumbai, Osaka-Kyoto and New York, none of which are particularly "undemocratic."

Degrees of, yes. And on a 2D6 - 7 + gov't type for law and a 2D6 - 7 + pop, you're average density 8-10 is going to be higher than 7 (8-10)

Well, again, you seem to be equating population ~amount~ with population ~density~ but I'm also not following your calculations here. As I read them, the "average"--most common, at least--values for Pop, Gov and Law are all going to be "5" (which interestingly makes Feudal Technocracy the most common Government type and "concealed carry prohibited" the most common Law Level).

Japan does have a lot of law and surveillance (Tokyo and several other metropolitan places for certain).

So does London, but most folks don't consider it to be an "authoritarian" place. . . .

The same government has reigned for almost long enough to be called a self-perpetuating oligarchy or an impersonal bureaucracy.

You mean at the national level in Japan? Sure, but neither of those Government types are "authoritarian" in Traveller terms.

As far as the major indicator of law in the Travellerverse (firearms possession), they'd be at least a Law 7 or 8 which is consistent. 

Consistent with what, an authoritarian government? I'm confused. . . .

There certainly is not an even treatment of all residents in Japan (including immigrants). Similarly, there are issues of caste in Delhi that see democratic divide. And in Sao Paulo (Those in favelas get far less attention than those in rich neighborhoods). Mexico also has issues and not every citizen gets equal democratic attention. Look at the ongoing insurgencies in several places in Mexico that stem partly from that. 

Or Indigenous folks in Toronto, eh?

Now you've wandered into details with which the Traveller Government and Law Level don't even begin to grapple. Yes, these look a bit like "authoritarianism" especially to folks in those respective societal minorities but this is hardly the sort of circumstance that Government type A or B or C is generally meant to illustrate.

For law and order, which naturally derive from government in Traveller, we'd see similar numbers to what was quoted above on average. The variation might be further because mechanically if you vary much in the roll for government, then roll with that outcome into law level, you get a stacked variance. Japan has high law levels by traveller standards (Osaka-Kyoto, Tokyo and other places). New York has more gun ownership, but generally has a fairly high incidence of police presence (they've been pushing that for a long time now). 

Well, if you're going to make the case that places like Tokyo and New York are "authoritarian" and "undemocratic" then you've begun to define those terms in ways that don't commonly make sense to most folks. I'm fairly certain when Marc and the other folks at GDW were crafting ~Book 3~ they didn't have post-War Japan and the United States in mind when they talked about the "Non-Charismatic Leader" Government type

And for every case we could find of population density that does vary towards less authoritarian examples or particular aspects that are less authoritarian, I am certain I can find more examples that are not.

I don't believe you could. We've already wandered through the most populous nations and the most populous cities and found that "authoritarian" governments are in the minority in both situations (as long as we can agree that Tokyo and New York aren't authoritarian places). Those trends will continue as you move to smaller polities across the planet. For just about every Chongqing there is going to be a Chicago. . . .

(Again, I think the more interesting correlations here will be--clumsily--related to ~Tech Level~.)

Traveller also, as pointed out by others, represents the representation of those characteristics that impact travellers.

Were you only talking about the impact to Travellers when you wrote, "Marc long ago recognized increasing population was inversely correlated to democratic and limited legal/police presence as scarcity led to authoritarian rule (world gen, CT)"? Seemed like you were talking about the actual government ruling the polity, not just those elements of government most likely to be encountered by off-worlders. My apologies if I misunderstood.

Again, I have said it is possible to have other results than the most authoritarian.

Sorry, I understood you to be saying that government, in the real-world, will tend to ~get more authoritarian~ as population increases, that this is what Marc "recognized" when he designed the world generation system to tend to produce those sorts of results.

This is the point with which I take issue. Yes, the world generation system is designed that way, but, in my view, that's as poor a simulation of the "real-world" as are many of the star system physical characteristics generated in ~Book 6~. It makes for an easy way to generate (those elements of which Travellers interact with) a planetary government, but it's a less-than-ideal simulation of the "real-world."