Nothing at all. You can plant flowers inside but I don't think trees will grow there due to lack of space. But you can use the fence to reserve a spot for a future building (police station or cafe, for instance) or just to prevent a new villager from building his house there.
Nope. I have perfect town status and was just informed by Kidd that he's moving out tomorrow.
Hmm, that's good and bad then for me.