We investigate the influence of environmental noise on polarization entangled light generated by parametric emission in a cavity. By adopting a recently developed separability criterion, we show that: i) self-stimulation may suppress the detrimental influence of noise on entanglement; ii) when self-stimulation becomes effective, a classical model of parametric emission incorporating noise provides the same results of quantum theory for the expectation values involved in the separability criterion. Moreover we show that, in the macroscopic limit, it is impossible to observe violations of local realism with measurements of $n$-particle correlations, whatever n but finite. These results provide an interesting example of the emergence of macroscopic local realism in the presence of strong entanglement even in the absence of decoherence.