This is no cultural exploration story. You could say the setting is more the War itself, rather than Vietnam as a country. Because a soldier is the narrator, we don't get a window into the rich culture or complex politics of Vietnam, the way we might if the story was told from a Vietnamese point of view.
Perry's an outsider—a young man in an unfamiliar climate, trying to survive—so seeing the world through his eyes means seeing the base conditions of the soldiers. The elements we hear about, again and again, are the rain, the mugginess, and the discomfort. For Perry, Vietnam is a place of rats, bugs, water, and mud.
It's no vacation.
For Perry and the others, elements of the country that might otherwise be beautiful, like the trees and rice paddies, are seen as either obstacles or places to take cover. Sometimes, normal settings feel dangerous, just to reflect how anxious the narrator is:
"Peewee looked up at the sky. I followed his gaze. The skies were a dirty grey. There was a thick cloud cover, heavy and threatening above us. A large bird started into the air as if it had been thrown, then stopped, spread its wings, and glided in a great arc to the west." (17.29)
Notice how those thick clouds are described? In another situation, they might be called fluffy, instead of "heavy and threatening." The skies are "dirty," instead of shady or simply dark, and the bird looks like "it had been thrown," instead of just flying. Thrown, like a grenade. Perry's mind is so deep in the war zone that the setting is just a reflection of how he's feeling.
There's another part of the setting, though: the time period. The story takes place in the late 1960's, and even though what's going on back home is in the very background—mentioned in a letter from time to time, rather than at the center—it influences the story.
America was drafting soldiers to go to war, and people who got into college could defer getting drafted. What that means for the story is that most of the guys fighting with Perry, as well as Perry himself, are too poor to go to college. Perry went to war because he couldn't afford college and didn't know what else he could do.
Anti-war protests were picking up in the late 1960's. Brunner blames the protesters on the dwindling numbers of soldiers they had to fight with. "That's why we got four and five-man squads," Brunner said. (12.14)
While the anti-war sentiment would eventually lead to America pulling out of the war, in the time of the book, it made men like Perry feel more alone.