This is a nice "I wish" project, but each transformation lacks strategy, which is the key component of any kind of transformation.
Regarding traffic, generally traffic increases as you build more roads. If you build more transit, cycling, and walking infrastructure, the same rule applies. If you remove roads, you are creating more of an incentive to use alternative modes. It's obviously not an instant effect, but as lanes are being removed from cars and converted to allowed bicycles in Paris, vehicle traffic has reduced by 5% in 10 years.
There are so many unknown unknowns that I don't even want to try to guess.
The author of the project decided to go with New York as the first candidate for transformation. In my opinion, this is a mistake. New York is likely one of the most challenging cities in the world to transform.
Or you're supposed to have a car, but not where you live, and infrequently move large objects that way.
I don't really get it personally. I live in a city, fairly centrally, and moving stuff that wouldn't fit on my cargo bike is a weekly occurrence or more. Plywood sheets, furniture, exercise gear, that sort of thing.
I think it only works if you fully subscribe to the tiny apartment + everything is rented mentality, which just sounds like a really fragile dependency tree to me.