The setting of Picnic in the Battlefield is very crucial to develop the themes that are treated in the play.
First, the danger surrounding the family and the two rivaling soldiers, Zepo and Zapo, makes their oblivious nature even more evident. When Zapo's parents show up in the middle of the battlefield to celebrate a picnic with their son, they completely ignore the horror surrounding them. This is congruent with the theme of living in oblivion and careless of what is both obvious and dangerous. Zapo's parents are proud of having their son fighting in the war but completely set aside the dangers of war, their son's lack of skills, and his immature connection to them
In the play, the battlefield is quite active: The characters could hear bombs and shots everywhere. In fact, these noises are specifically accentuated during the picnic scene, in order to show the magnitude of the danger that they have just gotten into. Interestingly, Zapo's parents continue their picnic, ignore the bombs (even when Zepo and Zapo themselves hear and try to escape from them), and continue their nonsense conversation. This is indicative of our silliness as individuals of giving importance to trivial things, and moving our attention from what is really important.
Finally, the two red cross soldiers coming in and out of the scene are morbidly seeking dead bodies to take back to their camp. Disgusted by not seeing any the men are clearly upset. Ironically, Zapo's mom continues with her nice and proper manners and apologizes for not being dead and sort of wishes them luck so that they can find some corpses. These same two red cross soldiers re-enter the scene to recover the bodies of Zepo, Zapo, and Zapo's parents. This is a clear message showing the horror of war and, once again, emphasizes the lack of common sense in the characters.
Therefore, the scenario of war presents a highly contradictory and contrasting setting: Politeness and family unity persisting absurdly under chaos.