Here's the unfortunate crux of the issues as I see it. (I think) Most of us would like to see Development moved up near the Android discussion area. But this would push down the phone forums, and being a user centric site, that might be a
big no-no.
The only way I see it working would be to do some major re-working and pruning of some of the other forums. This is of course a Phases decision and he would know best about whether these changes make sense. I'm just putting out ideas for consideration.
But here's a first stab at how this might work:
I know this is a lot of changes and/or a TON of work. But I figured it was better to offer up as complete an idea as I could without taking too much of the work side into consideration. i.e. this is mostly just a brainstorm : )
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Android Discussions
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Android Lounge (285 Viewing)
A place for general Android discussion and questions.
Applications (discussion) (660 Viewing)
All the information you could ever want about Android Applications. Learn about apps and get help with them... all here!
Audio, Video, & Ringtones, App Reviews, 
Announcements
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Whether free or paid, put Games on your Android Phone and play them! Talk about, share and discuss games for Android here.
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Application Development (121 Viewing)
Dev Lounge for the Coder Folks
Announcements,
Beta Tests,
(MIT) App Inventor, Enterprise,
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Custom ROMs (3 Viewing)
Bionx 
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Here's what I did:
1) Re-parented
Android Enterprise to app dev (not 100% sure on this one).
2) Removed
Accessories completely as these tend to be device specific and mostly talked about in device forums. However, this could maybe go under the Android Lounge with Enterprise.
3) Removed the word "
sub-forums" as it's already implied. The word "sections" or even a little arrow would work here too IMHO. Less is more (also see #5)
4) Removed "
ROMS" from any custom ROM group name (would need permission from them of course, but I think if we ask nicely that would be OK).
5) Removed "
link" from the name of any subforums, but was hoping they would still link in the same manner. (Not sure if this is possible). Essentially removed all vBulletin "link" indicators. I think this is unimportant info for a user and provides clutter. The concept and utility of a link is great though. It is just that I dont think users need to have an indication of the magic under the hood. (<- love mixed metaphors).
6) Merged
app dev 101 into regular app dev forum.
7) Removed one folder image just for this "mockup" because of the 31 image per post limit.
8) Shortened a few of the forum descriptions. (Mostly removing a sentence from the end referring to announcements, etc)
9) Changed "Beta Testing" to "
Beta Tests" (more in line with the language style eg "announcements" )
10) Re-parented & renamed
Android Media under Android applications -- because the main App forum gets many, many media questions, I was hoping this would give it better visibility and utility.
11) Made separate
Game Announcements and
App announcement forums
12) Re-parented
Job listings to App dev (could be a link)
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Custom ROMs is one of the bigger problems due to the way the sub-forums are organized in a nice neat table. They look nice as is, but they take a lot of vertical space.
Also, ROM devs probably dont want to see their names all balled up in a pile like I have it (which is perfectly understandable). So I'm not sure about that either.