Is it the case that most people living in the downtown area don't have a car?
Another portion of the population doesn't have cars or are otherwise uninterested in parking. This change would make it legal for there to be development projects that cater to this set of the population.
DTLA is extremely walk/bike/train/bus friendly, most long term residents I knew did not own cars.
Hopefully it's changing.
2. I'm not sure what census blocks you are including in your definition?
For a very long time, LA was also very famously anti-pedestrian, both in laws and enforcement. It's trying to change for sure, but I would not say it's there yet.