Personally, I like to build one massive castle and locate everyone in there. One castle so massive that it's kinda difficult to maintain enough NPC density throughout to suppress spawns, so it's not about cheap bare minimum shoebox housing at all. (In fact, my last one would have been even bigger if I had more NPCs to spread out further.) I just think that a big defensible structure is what would make sense for trying to make a living in the monster-filled, Blood Moon and Eclipse ridden setting of Terraria. Living all spread out would just be asking for monster murder. So if I am supposed to spread NPCs around the entire map more, hopefully the update adds some more NPCs, even if they do nothing but fill space to reduce spawns, to allow for everybody to be happy AND have one HUGE castle that stays monster-free.
Otherwise, this sounds like a neat idea I might end up kinda ignoring in favor of staying with the single massive bases that feel right to me. Which is fine, as long as unhappy NPCs simply continue to function at the current status quo of not having pylons and don't increase prices or otherwise present some punishment.
Also, if the idea is to encourage building, why can't giving NPCs big fancy fully furnished homes/castle apartments be what makes them happy anyway? That, I'm glad to do regardless. Absolutely minimal houses spread out into different biomes would have taken a small fraction of the effort my last castle did, but the former is what would get rewarded more?
...Also, now that I think about it, I hope the new town system doesn't alter spawn suppression so it's no longer possible to maintain one single, massive spawn-free zone by strategically spacing all available houses.