We actually know exactly when and where this story is intended to have
taken place, because Crane based the story on his own experience in a lifeboat
off the coast of Florida. The area was formerly named the Mosquito Inlet (as
mentioned in the story, 1.12, 1.19, 2.24, et al), and is currently known as the
Ponce de León Inlet.
The fact that the men can see the shore for most of the story heightens
and sustains the tension of the story, making rescue seem infuriatingly close,
but still impossibly distant. The appearance of the vacationers on resort are a
clever reminder that, despite the fate-altering turn that has overtaken the men
in the lifeboat, life beyond the boat goes on, same as it ever was. We can't
help but agree with the correspondent, either: we're surprised that the water
is so cold off the coast of Florida, too.