LOL my definition of a basement is similar to yours. In the house that I grew up in, the exit outside was a bulkhead so one would never have put a bedroom down there because that wasn't an easy means of egress. The basement in my last house (which was built in 1900) was straight out of Silence of the Lambs. It was so creepy that I wouldn't go down there at night. It had stone walls, the support beams running the length of the house were literally tree trunks, knots and all, the floor was technically cement but always had this weird, dirty coating on it, the house had 13 jack columns holding it up (which are supposed to be temporary supports), the pipes were all rusty, and the place was crawling with spiders in every nook and cranny. Shudder.
My current house was built in the 50's and the basement is clean, open and spacious. It is concrete with the small windows that you mentioned, but the exit outside is a set of stairs that go up to regular door (a "dog house" exit) so it's easy to get out. We did paint the walls and ceiling and carpet half of it, and then we had a carpenter build a bedroom with drywall, a ceiling, carpeting, etc. In that room we have two doors because the window is not a means of egress so in a fire, he would be able to get out from either side and either go out the back door or upstairs.
I have a lot of friends who have beautiful, finished basements where they've managed to put a regular door in either by doing what was done to my house or by trenching out the yard behind the house to put in a walk-out exit and/or full-size windows. To me, that's different than a split-level or raised ranch, which was designed to have a large portion of the lowest floor above ground.