Blades in the Dark works with custom settings, as long as those settings match the assumptions of the system.
The Doskvol setting is presented in the book to give groups a clear starting point, but can be replaced with another setting with some work to replace the factions, major NPCs and regions of the city. This is quite frequently done; it's not a trivial amount of work, but nothing's stopping you.
It is, however, important to understand what details the mechanics hook into.
The interplay of the PC crew with NPC factions is mechanised by reputation and relationship scores, so it's important to make sure you have a range of groups for the PCs to aid, anger and generally get entangled with in the course of their scores. Similarly, the Entanglement and imprisonment mechanics assume there is a police force and incarceration system - if your custom setting removes those, you'll also need to change the mechanics that rest on them.
Also important is the set of Action ratings (skills available to PCs). The breadth of these is important - there are mechanical incentives to invest in a broad range of them, so in a setting where some of the Actions are less appropriate, just removing them will have game-balance repercussions.
This is particularly relevant to your thoughts because you say:
My setting wouldn't have ghost and would likely be a lower technology level than the default setting.
Two of the action ratings are Tinker, associated with building, repairing and manipulating technology (including things like locks and doorhinges), and Attune, which in the core setting is primarily associated with touching the Ghost Field.
One of the system's assumptions is that all the actions are available to all PCs - you don't have to be a trained medium to try and sense ghosts, but it will be difficult and stressful if this isn't a core part of your skillset. The inclusion of Attune on the Action list means the assumption that interaction with some sort of mystical or supernatural force is a possible approach for any PC to take in appropriate situations.
With that in mind, you're going to need to think about what to do with those two actions. Replacing the ghosts with some other kind of supernatural force is perfectly viable - Scum and Villainy, a space-opera hack of Blades, still uses Attune but has it associated with something much like the Force from Star Wars, and that's doable simply by explaining in what circumstances Attune can be used and what results it gets - but there needs to be something. Similarly, Tinker is a significantly weaker choice in a setting without complex technology, which has wider repercussions on the balance between the game's Attributes.
Elements like Crew types and playbook special abilities are less of a problem, as simply not taking a special ability that references ghosts doesn't have such broad consequences. Options get a bit narrower, and the Whisper might not be a viable choice since they only have a small number of non-ghost special ability options, but there's plenty of space left for people to work in.
Your custom setting is certainly viable but may require mechanical changes that wouldn't be required for one that stays closer to the supernatural and technological context of the original setting.