why is watermilling it all not an option?
Just to be an annoying pedant, it's usually not possible to watermill all your riverside tiles as you can't have watermills on opposite sides of the same river stretch of river. It always bugs me when my workers insist on putting down my watermills in such a way that I can't have as many as I should be allowed because the fools put them on the wrong side.
In particular, I tend to build some Cottages early on in the game but then don't bother with running either Universal Suffrage or Free Speech, meaning that the Towns are decent but maybe aren't the best improvement to still be working.
Assuming that it's relatively late game and that I haven't won (probably because I'm playing on a tough difficulty level) and thus I have idle Workers who could be paving-over existing improvements.
Let's say that I am about to learn Electricity and that I already know Replaceable Parts.
I also plan to use Corporations over State Property.
Should I be paving-over my Towns and if so, which improvement types would potentially be of value?
Similarly, should I be paving-over my Farms and which improvement types would be good to replace them with?
Since we're talking about Flood Plains here (although you can answer in general, too), we have access to Rivers--assume that "enough" of the squares are Watermillable.
So, given that I plan to have Towns or Farms on my Flood Plains, when, if ever, should I switch them, given my above Civic choices?
If you aren't using state property then watermills are obviously not as great as they are with SP, so that changes the equation a lot. I would say that under SP in non-commerce specialised cities (and when switching to SP you can change a lot of cities over to production with good results) that you should watermill as many tiles as possible because in general higher pop = more high hammer tiles worked and at that stage of the game you can usually use excess food for engineers for even more hammers.
However, with corporations...well, you are going to be in Free Market which means an extra trade route, so there is a case to be made for higher population to increase the likelihood of attracting better trade routes. That argues for farms. On the other hand, Corporations almost always means the Sushi and Mining combo, in which case you should have adequate food with a decent sushi to get your pop as high as you like - which argues against farms which are clearly the worst improvements if you have excess food. In the case of adequate sushi food, I'd say cottages or workshops depending on city specialisation.
It is, however, completely pointless to build cottages late game without emancipation. And since you said you won't be using Free Speech I assume Bureaucracy, in which case cottages and towns are really only worth building in the capital.
Also, you said no Universal Suffrage either, so no massed rushbuy. Sounds like you'll be running Representation, Bureaucracy, Free Market, and if you can get away with it, Caste System (since emancipation is not so exciting unless you intend free speech and probably US - by late game your capital will have grown almost all its cottages to towns and won't benefit). You don't mind having excess food because your Rep specialists are strong, so high food tiles are good (again, sushi dependant). Workshops are nice because you have CS, if you have enough happiness.
In conclusion then, Cottages are your worst choice outside the capital since you aren't running cottage-friendly civics. Aside from that, your choice of watermills, workshops or farms depends on city specialisation - are you going for production or specialists. My guess is most of your cities will be geared for production (I know that's what I'd be doing), making workshops and watermills your best improvements in general, even without state property.
Oh, and financial changes the equation, obviously, but if you're FIN you might switch to more cottage-orientated civics.