How about this?
- an empty city would have vision and work area 2 tiles away.
- if the city has at least one unit inside, the work area would be extended to the level it's today on LT games -> 3 tiles away. Also the city vision radius would be extended to the same number.
This would be handled as a bonus for the city work/vision radius.
LT40 might be the best game for testing new stuff like that.