Waste's Edge is situated on the high plain of Belerinath at the headwaters of the Elenstroem. The land south of the river rises gently towards a range of low hills, that stretches all the way from Cirdanth in the west to the nearby mountains. Jagged cliffs on the hills far side form the southern coast of the continent and prevent the landing of any ocean going vessel.
Not far to the east lie the Oreth-Arinyae, the Mountains of Dawn, home to many Dwarves. Their closest settlement, Uzdun'kal, lies not far from the spring of the Elenstroem that makes its way over numerous falls and rapids down to the plain of Belerinath.
On the remaining sides, Waste's Edge is surrounded by dense, primeval forest, dotted with a few small villages inhabited by Half-Elves and Men. The nearest cities are Elgilad, the High City of Elves to the north, and Cirdanth, the elven Haven at the southern tip of the mainland.
For many centuries, a limited amount of trade between Elves and Dwarfs has taken place along the Elenstroem. The Elves desired precious ores and gems for their workings of magic and in exchange the Dwarves received all kinds of food they could not grow in the harsh mountain climate. Most of the actual travelling was done by Half-Elves, loyal and obedient servants to the elven Lords and Ladies, who did not mind the long journey through uninhabited wilderness, as is their nature.
With the arrival of Men, the situation changed. Their need for all kinds of ore as well as for the renowned dwarvish armour and weapons was by far larger. Soon big caravans were making their way through the wilderness, an easy prey for brigands and rivalling chieftains. The voyage by boat up the Elenstroem proved to be safer, but near the Oreth-Arinyae rapids made the river unnavigable. The boats had to stay behind, while the crews were carrying the goods into the mountains. As the landing saw more and more traffic, crude docks were erected, improved and rebuilt over the years.
Not long and it occurred to the merchants that boats moored on the plain of Belerinath, waiting for the return of their crews were not earning any revenues. In a combined effort, they had storehouses erected at the docks, so that both caravans from the mountains and boats coming up the Elenstroem could pick up new freight without much delay.
Any place seeing that much traffic attracts more people, seeking for new opportunities, and soon a smithy, two farms and the Redwyne Inn joined the small harbour. To provide protection against bandits, the Inn was surrounded by a wall and a small fee collected from every mooring ship pays for a number of guards.
Still, Waste's Edge lies too remote, and too far in elven territory, to grow into anything different than the small trading post it has been for many generations.
1. Gates to Wastesedge
I thought it might be a nice touch to have village gates. We could place guards at each one. The guards on the ones leading west toward Erinsford or over the bridge could block off the player from going through the with some excuse like "It's not safe because bandits have been spotted" or something like that. The ones on the other gates could give directions to Uzdun'kal or advice.
In addition to the huts, there could be a jeweler who makes things from the gems the dwarves mine and then occasionally goes to WE to sell them and there could be an Alchemist (where you could buy ingredients!) who uses the minerals and pure water from the mountains. It is also possible to meet Andare, Lareth, and Rhayne here.
3. Residential Area
Again a few houses mostly for variation and eye-candy. This would be families who just live in WE and don't own a shop or inn. There could be kids living there (Oliver Redwyne's friends perhaps) who you can play games with. Adults might be available for chatting or playing some of those board games that were suggested.
The venRhys family might also be available for interaction.
This is where Samis Desorin gets you to hunt down wolves threatening his sheep.
5. Waterfall Shop
Again, mostly to break things up a little. Might sell items useful in the mountains (a map of Uzdun'kal for instance)
Just thought it would make a cool secret place. Could be ruins of a small watch-tower or a monestry or something. It might be used as a hide-out for some bandits -> excuse to kick some ass and get a nice reward! There could maybe be a little sub-quest where you meet someone who's kid has been kidnapped and it's the bandits living in the ruins who did it or someone asks you to retrieve a stolen item.
As indicated on the map there could be a few secret passages here - one leading down to the road along the Elenstroem and one through the mountain (behind the waterfall -> eyecandy!) coming out to the well in the mountain settlement.
7. Underground Village and Abandoned Mine
Some tunnels with the occasional dwarvish shop or family. Could be a little maze-like to challenge the player a little (and prepare them for Uzdun'kal). There could be a hidden exit which leads to the abandoned dwarvish mine like the one Kai suggested. There could be exits to the river (which also runs underground at this point) and an exit to that little plain where I think it would be quite funny to have a house with NG living in it (He could be a Yeti worshipper or something).
The cemetery's layout is detailed here.
One of the farms in Waste's Edge belongs to Soko, one of the local members of the Society of the Blade.
There are some more hidden paths indicated by dotted lines and I'm sure we could add more. The hidden sections should IMO contain some kind of reward - some money, an item or a subgame.
The paths that go through forest bits should be a bit challenging - maybe have some more mosters than usual and sections where you need to jump/climb around.