Idea: Make it a "pocket island", but max out the number of races that can fit onto it. I'm usually able to to fit 100-120 races onto a pocket world with unlimited population cap and unlimited sites, but rare minerals. Give the world a single megafauna to make the Age of Myth be named something more fitting like "The Draconic Age" or even "The Age of Ishia". Only allow a dozen years to pass in World Gen - that should keep the goblins from multiplying beyond control, but allow things like Towers and various minor lairs to develop, as well as allow all the races to build up their populations enough to make post world-gen an interesting place to be in when all the wars blow up. With minerals set to be less common, precious metals like Gold become truly precious. After world-gen, we should scout around for minerals and use that as the initial reason the Humans decided to build an outpost there: to mine out those precious metals.
I've found that building houses with peaked roofs rather than flat boxes uses up more wood, and things like gutters or door placement become more important than they have been before. Likewise, not excavating a flat area out of a slop to put a house, but rather building walls on the down-slope side to produce the foundations for the main floor also are historically more accurate (and uses up all that extra stone from excavating the mineshafts too.) Eventually, I envision an area to be designated as "The Quarry" to specifically excavate stone for use in building homes/workshops, ect... because all the excavated stone on the map has already been used for one purpose or another.
Something to think about when planning your city: what kind of sewers are you going to use? Excavating those should give us a good general idea where houses and other water-needing/using buildings may be built. Run-off from the major streets will be going into these via grates, and of course all sorts of secret societies and underworld criminals may begin using these passages for their nefarious purposes as well. As the city develops, more cellars and possibly an underground highway might even be developed, depending on need and traffic flow.
To keep people from going through houses or workshops on their way to wherever, I suggest paving some main roads over the sewers and designating them as high traffic areas. As the city builds up along these main roads, sub-streets and alleys will develop naturally as a matter of course. I would further suggest that similar occupations each claim a side street on which to build their work-shops and homes. In this manner may the side roads be named: "Fisher's Way" for example, or "Old Mine Road". The fourth building away from one of these main roads could then have the address of "#4, Old Mine Road", and we'd know precisely where to find that house. Once we build up the city a bit, having some empty houses for adventurers to claim would really be fun, don't you think? They could walk over to the pub down the street or walk over to their favorite shrine or temple to pray or meditate. They might head up one block and over to #8 Metalsmith Lane to exchange some gossip with the weaponsmith there and maybe make a trade with that person for one of their weapons in stock.
That leads into my last suggestion for this post: Have each dorfed character choose a specific industry and become the "Guild Leader" for that industry. Anyone else wanting to work in that industry either becomes a Guild Member (and therefore able to be directly ordered and controlled by the Guild Leader from the forum) or pays some annual fee to be allowed to work for anyone as needed (like an added percentage of any work order that becomes the property of the guild.) By making each Guild workshop only allow those who are members of the Guild to use them, and setting certain stockpiles to only give to those workshops, then this system can be implemented with only a minimum of fiddling around. The city could be run by a Guild Council and whomever on the Guild Council has the most members in their Guild could be chosen as Mayor. The Mayor never is the one who gets to actually play the turn, but is the one who sets the "City tax" on all of the Guilds. (a percentage of that year's profits that go into the "Caravan fund" for trading with the Caravan. Every year, The Guild Council could get together and vote for who gets to be the Mayor for that year. The number of people in each Guild equals that guild's voting power.
If the City becomes populous enough, one Guild could rise to power over the others, and when a Royal title like "Baron" is offered, that Guild Leader would be the first to be chosen. After a little while, the most powerful guilds (or wealthiest ones able to buy the titles off of the most powerful ones), would become the nobility. The Noble titles are inherited, so unless the family died off, that dorfed person's family would continue on into the future. Over several embarks and in between bits involving adventurers, that could make the world that much more interesting.