This immediately separates the reader from the setting. We are not part of the setting and neither is the narrator. (Also note that the setting is also 'cold', connotes evil and negative imagery - suggests the setting is gothic based)
"Dark and smoky within"
"crude icon of the virgin"
= Gothic imagery.
"crude icon of the virgin" - Religious imagery - mockery?
"Far away" - further separation is created - aids the suspension of disbelief.
"wreaths of garlic on the doors keep out the vampires...oh, sinister" - the mocking of human superstition. Suggests that normal rules do not apply here.
"Then they stone her to death" - Suggests that danger comes from human imagination - could be Carter commenting on a wider idea, with her opinionated input towards our civilization.
"Here, take your father's hunting knife; you know how to use it" - Knife = power.
She KNOWS how to use it. She has experience, much like a man in craft work and knife related acts. Positive, rational paternal figure. Uncommon amongst fairy tales. Also suggests the girl is active not passive, she can defend herself like a man. Similarly suggests she is violent. Uncommon again.