As a reader, I'm interested in my vocabulary being extended by what I read. Recently historical novelist Liz Harris wrote a blog post about getting advice to moderate her authentic period language. One of the phrases that it was suggested she changed was "poke bonnet". Now, I might not have known before exactly what a poke bonnet is, and how it is distinguished from any other sort of bonnet, but I already had an image of that bonnet in my mind from reading other books - Jane Austen, Georgette Heyer - and was perfectly happy with it.
Other words that Liz's advisers balked at were bean porridge and buck fence. I don't know what either of those are, but I can make a guess that they're respectively something basic but nourishing to eat and a type of fence design. Which is indeed what they are (go to Liz's post for further details). Quibbling about the exact definition of bean porridge or a buck fence seems to me to be a nit-picking step too far, especially as the vocabulary evokes late C19th Wyoming, where Liz's book is set.
Anne Tyler, who is one of my favourite authors, keeps having characters wrap themselves in an Afghan. Now, the context indicates a blanket of sorts rather than a bloke in a turban. I imagine something made of crocheted squares in black and bright primary colours, with the squares sewn together using thick white wool. I have asked Americans and been told that an Afghan, while cosy, doesn't look like that. It doesn't matter. I've got the general idea, I've got a clear image, and that's all that counts to me as a reader.
Choosing to simplify one's vocabulary just because a reader might not understand really is dumbing down to the lowest common denominator - people can always look a word up if they're not sure. Same with writing for children. Yes, the vocabulary used needs to be appropriate for the age group, but children can handle unfamiliar words; it's part of the learning process.
The main reason I have a good vocabulary now is because I read a lot as a child and teenager. Books were my vocabulary teachers, so heaven help future generations if we writers limit our vocabularies today.