I'm more of a lurker here and don't post very often. But I do know a thing or two about IoA. I used to run a web site called mebweb.com, an unofficial guide to IoA, back in the late 90's when the park was being built. Basically, I turned all the press info and concept art into a web site. But the real draw was the park construction photos, some even from non-guest areas (but that's a story for another time).
Now that I've better introduced myself, I wanted to share the way I wish WWoHP Phase 1 had been built. I am not a huge Potter fan and don't claim to know much about the stories. But, here it is...
1) The first glaring thing is that DD/DC is gone. It would have been replaced by a new coaster that better fit the HP demographic, with a height requirement of 48 inches. I personally would have liked to see a launch coaster themed to riding on brooms and playing a game of Quidditch. While the bulk of the ride would take place in the confines of the stadium, I would have some sections that go into outside areas. The stadium, along with lots of trees, would also serve to block a majority of the FJ show building in its new location. Also, instead of completely scraping both Dragons, I would have looked into the possibility of moving one of them to the open lot next to JPRA and theming it to the Pterodactyl cage scene from JP3.
2) Hogwarts/FJ would be built in a different location, basically where FotH and the DC castle are now. The arrangement still allows for Hogwarts to be seen from the Hogsmeade entry and street. In reality, without the existing space limitation, the show building could have been configured much differently. The castle section could have been brought forward towards Hogsmeade with the bulk of the show building recessed behind it and the Quidditch stadium. In addition, the indoor castle queue would be doubled in size, with larger versions of the current rooms and new rooms such as The Great Hall. As far as the ride is concerned, the story would be altered given that there would be a coaster themed to a Quidditch match. The basis of the attraction would remain the same - Professor Dumbledore has invited muggles into Hogwarts for a tour. We would still meet Harry, Ron and Hermione as we do in the current version. They invite us attend a special spells seminar taking place today where we may have a chance as muggles to learn a spell. They say that it's possible one of us is unknowingly more than just a muggle. Just before we get to the ride load area (may still be the Room of Requirement or something else), we find that a new student has incorrectly performed a spell that has caused the benches to move. The professor in the room tells us to please carefully have a seat anyway and he/she will have everything under control momentarily. After we are seated on a bench, another fairly new Hogwart's student thinks he/she knows what to do and casts another spell. Again, the spell is incorrect and causes the benches to begin flying uncontrollably. We fly through a few Hogwarts corridors and wind up back in Dumbledore's office. We float towards the pensieve and the benches lean forward so that we are staring into it. Since we are mere muggles, the penseive shows the reflection of the last wizard to use it, which happens to be Harry. We are then taken on a journey through many of Harry's most unpleasant and frightening memories. The whole time we are on the ride, Harry, Ron and Hermione are trying to get us back. Finally, Harry pulls us back to the current time at Hogwarts just as we come face to face with Lord Voldemort.
3) FotH would be moved to where the FJ show building currently resides. While the ride would be the same, it would have a greatly expanded queue experience where guests would go into Hagrid's Hut and meet Hagrid in a pre-show using musion technology. Placement here would have also served to minimize the intrusion of the WWoHP on Jurassic Park (yes, I am one of those people who cares about this).
4) As you can see, a new single coaster would have left plenty of room for the Hogsmeade/Hogwarts Express station for Phase 2. My assumption is that UC already had a Phase 2 in the back of their minds when Phase 1 was being designed and would have left a small amount of space for expansion. Even if they didn't, the station could have been built into what are currently backstage areas on the other side of the perimeter service road.