Would that mean lowering the sides or raising the roads that go into the city?
It would mean more or less this: http://img140.imageshack.us/img140/1044/skcenter.jpg
One side of the gully where the road passed is leveled out, with the other incline is left with what remains. Leveling the whole city out isn't feasible. That beggar will get moved so he's not in the way of possible development. The parts of the road going out the east and west gates will remain where they are, so there's a short climb to reach the leveled out part.
Even just like this though I'm pretty happy with it, and Vorians had said he tweaked a copy and liked the results he did too so I'm thinking this will probably go live.
@Thomas: Thanks, it's always nice to hear from people who like what we do

I'm fairly certain Skyrim will have open cities. The layouts are just too open sided for them not to be based on the official trailer. Oblivion will thus be the odd man out in the series.