Well, okay. The thoughts I'm going to dump out won't be practical based on your judgement, but maybe we could bear them in mind-
My current idea would be a bulky, almost castle-like creation right up to y:128. Aerial plots would be connected by bridges to a sort of ledge (I don't know if there's a proper name for it) of the main construct with enough room for trees and roads. As of yet we haven't made very efficient use of our region and enclosing it with a citadel would give us more usable space than we currently have.
Come Minecraft 1.2 we could have a thinner pillar (maybe multiple, depending on how we set the castle up) that reaches into high-altitude floating roads more typical of Skyforge. This idea would minimize underwater plots but it would fix the space issue and certainly be more impressive than what we have now.
Of course we would want to make use of our underground space as well, mostly I suggest a full-blown clearing out of the underground portion which could see use as some nice efficient farms, forges and a newer, better arena.