I agree there with the amount of space being used, or rather not enough space since this is the first VV that I remember which was the most cramped as far as building space. While there are a couple of out of the way spots that can be used, there isn't a whole lot of space, whether used or unused.

In fact, VV4 has this huge grassy area that is useable for building.

Also, if you let your villagers do what they want, they might use the springs.