Well the problem is that this is what North American cities look like. But cities can be different. They can be mostly transit + bikes, but that seems impossible to do in CS.

It's definitely possible to build C:S cities that are "mostly transit" (and walking).

However, this only postpones the traffic nightmare. Eventually, the city grows to a point where the remaining ~20% of people using cars overwhelm even large, well-designed traffic systems.

Honestly, this seems depressingly realistic? Paris has lots of public transportion and walkable areas, and the Peripherique is still a traffic jam from hell.

As a North American, I’ve always thought Skylines looks like the European creation that it is. Skylines citizens flock to transit, will take multimodal trips, will walk a great deal, and will wait extremely long for transit vehicles to arrive. You can build a city in Skylines that is heavily transit-dependent in a way you would never see in America.

However you do still need roads as businesses need them to ship and receive, and this is where traffic management counts.

No, plenty of places around the world where not every street is zoned, where there is space between industrial and residential zones for example.