One of the reasons I've preferred Diagon over Hogsmeade was the total immersion I always felt when I was in Diagon. I think the new area in, in place of DC, will help to even the field.
With the size D.C. Was, WB/UC actually have he ability to completely transform Hogsmeade to be nothing like it is today.
As it currently stands, you snake up the tight streets of Hogsmeade and then make it to Hogwarts- it's grand as an elevated structure, but the thin walking areas remain with Hippogriff on the right.
They have the ability to keep the appropriately tight streets of Hogsmeade and then allow for a grand reveal, in both height and width with Hogwarts.
If they can make a viewing area for the castle show (and new castle shows) while subsequently pushing hippogriff back closer to the Forbidden forest area, it would transform Hogsmeade completely into three
separate areas, instead of the singular area that it feels like today.
I truly hope they take this opportunity to give us the feeling of grandness in that area. By doing so, we would get:
1) A much needed night show at IoA with the ability to support the crowds due to the viewing area.
2) A rebuild of Hippogriff allowing for the improved and slightly higher capacity (18 vs 16) Mack version that USH has vs our Vekoma version.
3) 3 Seperated areas that are more true to their forms
That D.C. plot had so much potential and size that I'd hate to see them squander this opportunity. I have a bad feeling we're going to get a FF attraction that takes up a few acres and we're left ~3-5 acres just sitting there beyond hippogriff.
For the record, I know my feeling is unfounded as WB/UC working in tandem have done nothing but exceeded our expectations.