What matters are the setback distances, not how the neighboring houses have dealt with them. It also does not matter what was approved in the previous building application, but only what is possible according to the legal situation. What is not allowed: multi-story buildings with 7 units or something like that.
But if the setback distances are sufficient, two full floors should not be a problem, nor an adequately high knee wall. That is also completely normal for a single-family house. Here with us, originally only bungalows were approved; some imbecile decided back then (in the seventies of the last century) that this corresponds to a traditional Swabian construction method (which is complete nonsense, but when such a moron holds such a position, this is what happens). So everyone here built bungalows with pitched roofs and zero knee walls because everyone thought that was the requirement. However, the development plan was never really adopted. When further houses were built after the first construction phase, they were relatively free to build. No more bungalows and spread out wide. Now it was indeed allowed to build with a ground floor and upper floor. My parents regretted it back then; they would have much preferred to build like that instead of this bungalow (although now it is rather an advantage for my 80-year-old mother – even though she is still fit enough for all kinds of stairs). We could have also put a cube-shaped house there – unfortunately, the setback distances did not allow it.
But we even got an approval for a setback overlap. We were able to justify well that it is better for all parties if we move the house one meter backwards and thus reduce the setback distance at the back. We succeeded with good arguments (more sun for all neighbors). Good arguments for an exemption are, for example, a better orientation of solar systems etc. So what I want to say: you have a lot of possibilities there.
A good architect – in this case one who has a good connection to the responsible building authority and is willing to deal with them – can get the maximum out of it for you. And the appearance of the neighboring buildings is relatively irrelevant in this regard. Think about what you want, what the building envelope (here not predetermined but only limited by the required setback distances) allows, what makes sense and what needs to be considered (e.g., noise pollution from this main road). With the shape of the plot, as already mentioned above, I would not rigidly insist on a rectangular floor plan. I would only copy from the neighboring houses if there is something I really like (which I did not really see in the pictures: please rather not!).
Otherwise: build yourself a nice house there, with a capable architect and exactly the way you want it and how the laws allow it. And as I said, that is relatively free!