That is spectacular; don't touch it please.

It's beautiful, but this is Phonenix. Water is SO scarce, you should fill it in and replace all that with xeriscaping.

There is currently no backyard because this takes over. I was hoping to reduce this 45,000 gallon pool to maybe 10,000 gallon play pool

You could go a long way to reclaiming space of all the fussy plants in small planters were removed. If that doesn't allow enough space you could reduce the size of the pool, and leave the waterfall but it won't be cheap.

I would reduce it to about this size and leave the water fall which is surely just recycling the pool water. Turn the rest into more patio and perhaps a bit of artificial turf, if you're serious about those issues.