The original frame of reference was "car with antigravity", and in 1977-82, 120 kmh was significantly faster than cars could legally travel in the US.
This is because at the time they wrote the game, the US national speed limit was 55 MPH (88 kmh). It wasn't raised again until the mid 1990s. The canonical CT vehicle you're discussing is the Speeder (TL 8, like the Air/Raft), and, surprisingly, even it wasn't supersonic.
But (dead horse abuse alert!) once you get above the atmosphere, neither drag nor frictional heating is a constraint.An canonical Air/Raft can easily exceed that 19,000 fpm (100 m/s) in vertical ascent in a vacuum. In the lower atmosphere it's drag-limited to 8m/s if ascending flat, 33m/sec if nose-up, because it has the aerodynamic characteristics of a heavily-starched flying carpet. Streamlining can enable far better performance than that, but as-written they're not particularly streamlined.
I agree, but for slightly different reasons. They're only "realistic" if you're operating in the lower atmosphere with vehicles that look like TL7 ground cars and have 0.1G (Air/Raft) to 1G (Speeder) thrust after neutralizing their own weight.
They're far too conservative because they do not account for aerodynamic optimization, nor do they even consider exo-atmospheric operation aside from "going to orbit".
Basically, given the stated capabilities of an Air/Raft, it could reach any point on Earth (20,000km distance) within 4 1/2 hours: 1 hour and 15 minutes to 100km altitude, 3 hours above the atmosphere (would be 2 1/2 hours but escape velocity limits peak speed), and 15 minutes getting back down again. Average ground speed is 8000kmh. Shorter trips would have lower average ground speed since the climb/descent would be a larger portion of the trip.
A speeder built like a scaled-down X-15 could easily go Mach 3+ in atmosphere. But then, when an Air/Raft can effectively travel at Mach 6+ over the longest distances, why would you need one?
And all of this discussion is about TL 8 grav vehicles that don't have much extra thrust left over after hovering -- once you get to TL9 and up designs, lack of thrust is no longer an issue.