I actually think you make some good points. Alleys are the backside of buildings, drab and dull. Claustrophobic and nasty. Rowling's London harkens back to the imagery of Dickens and Conan Doyle here. Always a master of utilising established imagery. Her backalley London is the one of Jack the Ripper, dangerous, filthy, misty (the perennial smog of industrial era Britain that covered London like a black blanket).
It is a great setting for a book and movie. But is it also great for a build themed environment? Why would one want to visit an ugly surrounding? In many ways, Diagon Alley is the anthithesis of classic Disney imagineering. Not beauty, but ugliness. Not the architecture of reassurance, but of unsettling, dangerous disturbance. Perhaps a natural further development of the direction WDI itself moved into in the nineties, when the ugly backsides and underbellies came to be regarded as the most interesting areas for themed environments, probably as a reaction to the reassurance architecture of old, and because it was deemed to hold intrinsic storytelling appeal for evoking tense, dangerous feelings by default. ToT descends into the ugly industrial boiler room, RnRC takes you to the backalleys, DAK has 'authentic' warts and all as its theme, in contrast to the photoshopped version of distant lands in World Showcase.
The culmination is Diagon Alley. Whereas New Orleans Square shows the gorgeous side of New Orleans, DA shows the gritty side of London. A side that is at best dull, at worst ugly, claustrophobic, dangerous. Tall, inleaning buildings to instill fear, as opposed to the miniature forced perspective quaintness of Main Street. Dark colours, not a single trace of organic manner, versus the exorbitantly colourful areas of classic Disney, always full of flowers and greenery.
It is a far cry from the beauty and reassurance of classic Disney. Albeit mitigated by being the somewhat innocent Harry Potter version of backside London.
DA stands in stark contrast to its near exact contemporary, Ratatouille in WDSP. Which depicts not London but Paris, and does so with the wide open plaza instead of the narrow, dangerous, dull backalleys, the pretty front instead of the gritty backside. The front of houses literally show the façade instead of the grim reality behind. But personally I prefer them for a theme park for that precise reason - why should the fantasy version of reality exaggerate ugliness? Why not, if for once one does have the ability to augment reality, not exaggerate beauty instead?
