This is how I have my islands organized.
It's probably not the best, prettiest, etc.,
but I thought I'd share how I fit everything in.
Obviously this setup is for before Pures were introduced. All buildings and Habitats fit other than the Pure habitats.
This image shows the setup with the pure habitats.
I just replace one of each Element with the Pure version of the habitat.
I replace the Pure habitat with a second Earth habitat
and put the Kindergarden in it's place
because the Pure habitat is a little bit bigger than large habitats.
There is enough room for all of the habitats and buildings on four islands,
but the Dragons won't all fit once all nine Pures have been added.
For those complaining about room, I'd say give it a bit of time. Everything isn't out yet and I'm sure they will work it out. The collecting is a huge aspect of the game, so I can't imagine they would leave it where we can't have at least one of each Dragon.