How big is this space?
I think start with clearing out what you are not keeping first. Make a plan for what you can do with it.
The pavers will be a lot of work but you may be able to repair the uneven parts if this is a dry laid path.
What kind of fence are you putting in. A solid fence will block light and air. A slatted fence will allow air and some light in. A chain link or wrought iron fence offers less privacy but will let the most air and light in. A chain link fence will be the cheapest to put up and offers possibilitiies for traingin some edibles like peas, beans, squash, cucumber or an ornamental vine like clematis or a climbing rose. I prefer the edibles mainly because they are temporary although some of the squash and beens can get very long they are annuals and only live a short time so the vines won't eat up the garden permanently. The planting strip is narrow but since vines go up some low flowers or herbs and vegetables like lettuce and Asian greens would grow 6-18 inches tall. Some herbs and vegetables can be interplanted among flowers so they look more ornamental but are also practical. Some even have edible and ornamental flowers
https://content.ces.ncsu.edu/choosing-a ... ers-ag-790
I would actually think about rebuiliding the shed for storage. You can add a little porch on it for a sitting area. Maybe with a swing or hammock. and a table. you can hang lanterns from the porch ceiling for lights at night.
http://www.familyhandyman.com/sheds/how ... h/view-all
You can use a regtractable clothesline that won't be in the way when you want to use the yard or you can hang the clothesline in the shed but furniture would have to be collapsible like folding chairs and tables that you can keep in storage. I would not put in the side window if there isn't a view.
On the other side I would do tier plantings. In the back something tall and long blooming like hollyhocks or some foundation shrubs like Dee Runk boxwoods that grow tall and narrow. Hinoki false cypress (Chamaecyparis obtusa) is one of the most versatile and durable plant choices. Most cultivars grow slowly into irregular pyramids that need little to no pruning. (Zone 5). They would still need some maintenance. In front of that I would do annuals. Similar to the plan below. As long as you select plants about the same height you can substitute different plants or a different complementary color scheme.
Layer the plants and repeat. For the best effects it is better to mass plants in groups of three or more rather than one plant at a time. It stands out better and is more cohesive. Dividing the groups and planting on both ends makes it look more cohesive and balanced. Leave texture and shape also add interest. Thinks like spikey ornamental grasses can contrast with soft underplantings. White and dark purple go with almost anything. Choose plants with long bloom times or plants that bloom in different seasons if you are using perennials.
Annuals complete their cycle in a year or less. Sometimes as little as 50 days. They grow bloom and die. They need to be replanted. Most of the summer annuals, and vegetables are like this.
Perennials can live a year or more. Some are shortlived and grow the first year and bloom the next and then die. Perennials usually have seasons of bloom and most do not bloom year round.
Before you put in the plants you need to amend the soil with compost and fertilizer. And continue to add compost and some fertilizer every time you plant. Mulching will keep weeds down. Measure the space and do your research. Space plants according to their mature size. It will look bare in the beginning; mulch will help. You will save money if you follow a plan and don't have to pull out the extra plants later.
http://www.bhg.com/gardening/plans/easy ... an/#page=0
Happy gardening in Hawaii. Gardens are where people grow.