I generally treat most areas of the Territories as having late Bronze Age technology and social structure with a bit of middle ages government vocabulary from time-to-time to help familiarization. In a few select areas that have an increased population and commerce, I treat select settlements as having early Iron Age technology and social structure with a bit of industrial age government vocabulary from time-to-time to help familiarization.
I treat all settlements as independent city-states with outlying rural areas; few settlements are truly cities, but most have a distinct barrier (e.g. walls surrounding Dawnrock). Most settlements are towns, and a fair number are merely villages or hamlets. I try to save hamlets for custom settlements that are not on the map or for outlying rural hamlets of an existing settlement.
Government is rarely the same from settlement to settlement; each has developed their own governance–typically not democratic. In fact, democratic settlements are among my rarest incarnations. Most are rather communal and monarchal, some are republics; all have a smidgen or more of despotic tyranny involved. No settlement has a perfect governance model.
The trade and commerce relies heavily on functional, stable, safe paths, thus the Guard have the largest influence on distribution of trade goods and wealth; however, nearly all jobs are local to a settlement. Very few mice travel for work beyond nearby settlements; for example, the lake towns of Grasslake, Burl, and Lonepine share a great deal of trade on the lake and surrounding trails, but workers generally do not travel between towns for jobs. In contrast, the pond towns of Oakgrove, Birchflow, and Willowroot do share some travelling laborers, since they are closer together; however, the patriotism of mice to their native town is still very high (so prejudice about hiring outside the town is pretty strong).
This also means that technology becomes rather localized. Sandmason has glass; they produce glass in great variety with extensive skill and creative talent. Copperwood is a major copper mine; Ironwood is a major ore producer. While each of these settlements trades a great deal of their products, each is also careful to ensure the secrets of their vocation are not spread from one place to another. They are incredibly careful to ensure the town retains that talent. In some cases, this is very easy to couple with the location of the natural resources, and in other cases, this cannot be done (e.g. Elmoss has many moss harvesters, but moss can be grown in many areas with as much ease as near Elmoss; in contrast, no other settlement has got quite the same access to apples as Appleloft).
Having Bronze Age tech means many weapons and armor are bronze, brass, tin, copper, wood, bone, stone, and even a few are glass. Having Iron Age tech means most weapons and armor are iron, impure or untempered steel, bronze and such as Bronze Age tech. The smiths are also working with gold and silver in large amounts for jewelry and accessories. A smith who can manage to smelt iron, especially with a moderate amount of charcoal, can develop quality weapons and armor, but will also require a large recompense for the incredible talent. Workers in bronze can make very high quality items at a better cost and with increased speed and variety; reduced costs give way to increased engineering.
I’d say, there is nothing wrong with finding or engineering a crossbow. It seems reasonable. Throughout historic Europe and Asia, weapons and armors as well as many other tools, hardware, and engines were the result of ingenuity more than available resources. Also, different cultures produced and implemented different resources according to culture, belief, international exposure, and other factors. One such example exists between Romans and Vikings; due to exposure to Asia Minor, Romans learned of steel and made much use of it during the later era of the empire; however, vikings were still using crude steel methods from late iron age having had less exposure to advanced metallurgy and possibly other factors. Very few examples of hi-quality steel are found among vikings (though admittedly, the romans didn’t have amazing steel either, but closer to modern standards).
You should decide what you want for your Territories. Consider a few things: Who is developing weapons and armor? What is the general purpose of such research? How often are armies forming and in need of quick stockpiles of weapons/armors? Who is willing to produce, sell, and repair weapon/armor stockpiles?
I think those are more important questions than the tech level; however, you’ve got my two cents above.