The Outer wall is a barrier against the dangers from outside the city. In its shadows is another barrier, one from hope, comfort, and warmth.
Sky street (and the blocks around it) are odd. The shadows are darker. The air is damper. The mood is bleak and errie. The street is silent, all the noise muted somehow. However, you can always seem to hear someone crying.
Everyone has to live and work somewhere.
The street is wide, and smoothly paved, with trees planted along the sides. The houses are mansions and palaces, each surrounded by stone and ironwork walls that are as much decorative as they are protective. These are the summer homes of the Princesses, and ladies of privelage.
Want to avoid fighter types focusing on swords? Make Longswords and Bastardswords the weapon of the Noble class, with a death penalty for other to carry. These weapons will be ornate and finally crafted. Adventurers will be stuck with cheaply made broad and shortswords, while professional fighters might use two handed swords.