I live in the city, and I've replaced my entire front lawn (about a 20' x 20' space) with various groundcovers, with dwarf shrubs and conifers as foundation plantings. You cannot go wrong with groundcovers: easy maintenance, low water consumption, plus year round interest. Some of my favorites:

any of the sedums
lamb's ear
hens and chicks
the really dwarf geraniums
plumbago
all of the dwarf veronicas
various heucheras
dwarf lavanders
dianthus
dwarf nepeta
etc., etc.

I basically just put them in whereever, but I have two rules: they have to be true groundcovers (no higher than 4-6" for base foliage; flowers can rise above the base foliage, but they have to look "airy"), and they have to be in the cool (blue, purple, glaucous) color range. Nice foliage is a real plus, and adds the year-round interest, even here in Wisconsin.

Some day I will put snappies up of my garden. But only when I get the time/learn to use our digital camera.

Good luck & enjoy your garden!

Be warned, none of them can take as much foot traffic as grass. So you might want to put a well-placed rock or two to discourage people walking across.

Creeping Jenny can take a little foot traffic, as can thyme.

Janet's Garden

You might want to consider adding a berm along the sidewalk, or at least part of it. It will help to keep foot traffic from the street off your planted area, and will, in fact, add to your available planting space.

There aren't any "floral" plants that can be walked upon the way a grass can!
Grass is the easiest of all "lawns" to maintain. Other plants require pruning, weeding, deadheading, replacing from time to time, and you'd have to walk on what you have to get into the center.

Something to consider, If folks are walking on the floral area, its also a habitat for bees. I love bees, but bees and feet/ankles/pantlegs arent allways the best combo. I am sure there are lots of flowering areas you can have that wll be the hight of and less care than grass, (I hate lawn and dont have it) But safety is something to consider along with the hardiness.