OK, I've looked and can't find any explanation of this. It's happened to me in a lot of neighborhoods, on CC worlds.

I bulldoze a lot to put in a smaller lot. Lot disappears from the map, but when I try to put in the new lot, no matter how small it is, the game says "cannot place on lot". But no lot is there. It's not an unrouteable terrain issue, because I can't put a 10x10 empty lot in the middle of a large blank area that previously held a 64 x 64 lot.

This seems only to occur with lots that were put in at the time the world was created, but I could be wrong.

What is going on and can I fix it?

BTW, despite what it says, I have all EPs and SPs except the pink thing from Katy Perry or whoever she is.

I've had this happen a few times with CC Worlds and still can't figure it out. I have been able to correct it on some occasions by going into live mode and resetting the world. I've also see it correct itself by exiting the game and reloading. Perhaps having Error Trap and Overwatch facilitated some sort of clean up that fixed it but like I said these things haven't worked 100% of the time. Generally now if I am playing a world I like I do a Save As before I start bulldozing so I can at least get back to the game with the original lot.

I hope one of the talented builders sees this thread and can provide some insight...I'd love to know why this happens and what we can do to fix it.

Haven't done a reset, but I've done everything else you've suggested. I hope somebody knows. I'm building in a small world this time and I need all the space I can get.

I'm sure someone will along and hopefully have the answer.
I love playing small worlds, especially island types ... if you're looking for tiny community lots there are some really good links for Tiny Community Lots and a small cottage on the page. They've all been played by either myself or others at NRaas and they work just fine. They might come in handy if your short of space but want it all