Atrios is right that urban residents' fear of disruption does not necessarily affect development plans in a positive direction. On the other hand, I don't think any "big project" can ever really deliver the kind of ideal urban vibrancy that attracts people to cities in the first place.
In the Gospel According to Jane is it writ, buildings close to one another should be of mixed construction age, not just designed for mixed use or income-level. Any big development is inherently going to fail at that and is going to have to succeed in every other aspect of urban planning just to break even.
But big projects are big profit, so developers are always going to push for them. Residents might be misguided in opposing any change to the status quo (a static neighborhood is not a healthy one) but in the case of confronting real big development projects, they will probably almost always end up minimizing the damage that these projects can wreak; limiting the height of a project isn't necessarily an ideal way of keeping an urban area healthy and vibrant, but if it's the only feasible means of limiting the project's scope then I think it's still justified.