Well, as someone who has flattened their island at least a billion times, I advice you start brain storming and planning out places. What I do is take the terraform tool and map out some idea with the dirt tool. It kinda gives you a piece of mind if your worried about having such an empty area.
The first thing I did was make myself a castle, because I told myself I wanted one. The next day a small area. I wanted to make, from there I did my entrance, planned out where I wanted to put side walk. I didn't bother about moving my villagers. The only one I did move was to the small area. But yeah I then had to do alot of pondering. Kinda think about what I want, run around till I find a place I might wanna place it and I make a like a square of side walk there, then if I dont like it I can just remove the side walk
It doesnt come right away when you flatten your island, even with ideas, a wide open space can be daunting. But this is also your chance to make it your own. But having an empty space can be daunting fot some, so if it does use your side walk tool, and run around thinking about where to put things. So its a new opportunity to make something you really like.