Let me see if I can respond to all the points brought up...
1) Seat: yes, I think this winter I'm going to pull off the cover and reshape the foam, probably following the Giuliari style. My mom is pretty handy with the sewing machine; maybe I can talk her into making a new cover.
2) Cables: I've managed to route most of them decently with the exception of the brake line--that definitely needs to be a custom length. I routed the speedo cable straight up through the left hole in the lower tree, then crossed over behind the headlight. Hopefully those two bends in there aren't too severe for it. Otherwise it's not touching the tire or wheel at all.
3) Brace types: I've seen the hoop style on XS650's and mountain bikes; I like that solution. Just a matter of finding one, or fabbing one up like snyquist53 did.
4) Fenderless causes more problems than it's worth?: Safety and stability is definitely an issue, and so is inclement weather. Maybe bobbing the fender would be the best compromise?