It's an interesting theory, but I'm hesitant to give much weight to weakly-supported hypotheses intended to explain very broad and inclusive phenomena, like "murders (or a lack thereof) occurring within these arbitrary geographical borders." This is especially true when there's no shortage of plausible theories and a lot of potentially-useful information is missing.

The changeling myths seem to serve the purpose of guilt-relief only insofar as they also aid shame-relief, so I''m not sure they're all that helpful. (Am I missing something?)

Basically, this reads to me like an interesting but not particularly credible just-so story.