" You don't think it will look funny if I start with my plantings on the outside of the walkway? " Especially seeing the second view, I definitely think it will look funny/pathetic if you confine your plantings to that teeny strip. Here you can get a sense of what that looks like:
You are getting some very good advice here (and all free!
) I like AS suggestion of a butterfly garden, but you would want a couple trees and shrubs to anchor it. Can look a little weedy otherwise, alot of same height stuff. Dogwood and redbud were great suggestions. Serviceberry is another not too huge native tree that has berries that 40 species of birds like (too big for your alcove, but not to anchor one of the ends of your planting).
Purple ninebark is a nice shrub, purple foliage for some color impact, berries that birds like, peeling bark for winter interest, fall color, low maintenance. Var. Summer Wine is a smaller version of it, 4 to 6 feet high and wide at maturity. Viburnums are another berries-for-birds shrub, with deliciously fragrant spring flowers, come in a wide range of sizes from very dwarf to large. Hydrangeas also come in a range of sizes and are nice summer-fall bloomers. You will want something evergreen for winter, maybe a low growing juniper.
So there you have it: 2 or 3 nice trees, 2 or 3 nice shrubs, fronted by a gorgeous butterfly garden and then edged with something small and low growing: maybe some lambs ears or artemisia for something else non-green. And pop in some annuals like petunias along the front edge for some season long color... All of it in FRONT of your walk way. You could just fill in in back with ground covers or more low growing stuff..
And later when budget permits, add that island bed in the lawn... Your place will be stunning! Here's a picture of one, though I would do it more free form not just a nice neat little circle: