The crazy road builder wasn't crazy, he was a visionary. A man before his time, a true genius.
Also it's inadvisable to try to build a road where people specifically don't want one, if laremere doesn't want it too close to his settlement, then don't put it to close.
To ignore his wishes is to invite distruption.
It wouldn't take a lot to make a road largely unusable, certainly less effort than it was to build the road in the first place.
As for building the marketplace at the intersection of the road colors, I believe the location you've pointed out is pretty much right on top of Laketown.
I'd want to get consensus of the local populace before thumping that thing down on top of them (people may like it, or they may not)