Sure, but we need to have people on our territory as well…

Why? Most of the stuff it does that’s useful works as well, or better, in isolation. Trees and crops growing, and nature being spectacular, mainly.

And let’s be realistic, most people want space and it’s beneficial to people’s mental health to not be stuck in super dense living conditions

I mentioned sprawl, so that does still leave room for more low density.

That being said, I don’t know that it is universally better for mental health. If by “super dense” you mean Kowloon city, sure, but lots of people live in apartments or townhouses and are fine with it. Conversely, not everyone enjoys yardwork, and if you have a single home with a yard you need to do that, unless you’re okay with landscaping in the form of wasps and skunks living in a dense patch of possibly-invasive weeds.

More small cities with all services available would be a great thing (I’m saying that as a person living in a small city of 7k with all services available).

Eh. It works for some people, but maybe you need something - anything - somewhat niche. Career, hobby, social, health…

Gay? You’re mostly fucked. Need a specialist? Fucked. Into reenacting Roman battles? Fucked. Want a job besides welder at the local shop, trades or low-level retail? Fucked. Although I guess remote work would fix some of that. Want to buy something at night? Fucked.

You’re covered if all you want is groceries, fast food, booze and (shortages aside) a family doctor, but as someone from an even smaller place, it’s very limiting and young people tend to leave.

Also, that many small cities would be a bit of a transport problem. You basically couldn’t have freeways; it would be all local highways. Where would you put the big airports? Would they have their own town? Without those you get to take the scenic route 1000km+ to whatever or whoever you need to see in person. Or charter a private plane, I guess.