I like the nanotechnology idea. But this has JJ's influence in it, for all we know it could still be THE HAND OF GOOOOOD that is causing this thing, and each amulet holds a piece of the shroud of Turin. Or something.
I'm sure that guns work just fine and may even be plentiful in this world, but I'm likewise sure that the machinery used to make most 5.62mm or .303 bullets ran on electricity. There may have been old manual stamping machines out there able to make shells, but they're not exactly plentiful... Hence the muskets, though someone would have to have the knowledge to create those first too since they're not exactly common firearms either.
Someone asked why there aren't steam trains, since fire still works and so should any sort of steam technology as a result. I wouldn't be surprised if one doesn't eventually show up, but it's not like it would be easy to clear enough track of unmovable diesel electrics, and create the infrastructure (water towers, coal mines, etc.) to maintain a railway, to say nothing of breaking museum pieces out of their disconnected rail lines (as they would have to do in my city's heritage museum, anyway). OTOH, it HAS been fifteen years. Heck, I could see a whole season devoted to people getting a simple steam railway between Chicago and some neighboring city going. Transportation opened up the west, and that's a running theme in this show.
With this latest episode it's clear that some cabal of nerds at the U of Chicago was invovled, and that these little amulets are going to be the source of figurative power Monroe will be searching for. Does he already have one? He's mentioned ice twice now; they had ice before elctricity, but it wouldn't surprise me if he had a minifridge and solar panel somewhere cooling his tea.