Thank you for sharing your project. The link below is a short animation of your project. I suggest you watch it first.
Rather than that, I rendered your project both night and day to make it easier to visualize both situations. I also made a distinction between the performing situation and the normal one which the pictures will tell you the difference.
When you enter, the very first thing that captures your attention is the combination of the contrasting features, fire and water with Mediterranean pattern jalis on the wall to make the space to show off. The next feature is the fountain/stage that have dual functions based on your needs. Right in front of the stage the stairs are extended and there is also a row of seats for the smaller audience. For larger groups of people you can add folding chairs. The audience area is created in a way to maximize the number of people enjoying the art. The stage can convert to a fountain when you don’t host a performer.
Under the retaining wall stairway, you can have a planter that adds to the beauty of the yard.
The covered patio has a fireplace with built in seats that have storage underneath for cushions. Right behind the seat there’s a bar table that can be used for drinking or eating a light snack with the view of the canyon.
And lastly, in the upper deck you can easily chill on the bed loungers or to gather with your family and friends for a barbecue. You can also increase your audience down in the yard by putting the performers on the bed lounger spot. Therefore your goal will be reached by letting you use the space flexibly.
Hope you enjoy.