@Andreaz: I'm not sure why #1 would allow me to have a much larger arena, but it would allow the user to 'strafe' left/right more intuitively as well as move forwards and rotate more easily.

@JSoftware: isn't GTA a 3d game? would you have a screenshot of a 2d version or similar? If I went for #2, I think it would be much harder to control things like strafing, etc. and the user may get confused.

As you may have noticed, I'm starting to think that I should go for #1, mainly due to control concerns, but more opinions wouldn't hurt

So fire away people ;-)
cheers,
Paul