With the rapid acceleration of urbanization, traditional villages in China face increasing pressures of preservation and development. As vital carriers of ethnic culture and ecological value, these settlements require a scientific framework to assess their protection, utilization, and development levels. This study focuses on Youyang County in Chongqing, an area rich in ethnic culture and diverse ecological environments, to construct a comprehensive evaluation system based on an improved fuzzy comprehensive evaluation method. By integrating multi-dimensional indicators—cultural value, ecological environment, economic development, and social participation—the proposed model addresses limitations in weight determination and membership degree calculation inherent in traditional fuzzy methods. Empirical analysis verifies the method’s effectiveness and stability, revealing that Youyang’s traditional villages excel in cultural preservation and ecological quality but lag in economic vitality and community engagement. The paper proposes targeted strategies for sustainable protection and utilization, aiming to balance cultural inheritance with rural revitalization. This research contributes both theoretical insights and practical guidance for enhancing traditional village management, offering a replicable framework for other regions seeking to harmonize cultural heritage protection and sustainable rural development.