Your plan sounds perfect! We have the same issue in our backyard where I no longer have any grass. I would start with a small tree or two-something flowering that can take some shade like a dogwood (native or Kousa). Then, I would add shrubs planning the planting for their full size- azaleas are so easy and spring will be lovely if you have a large number of them. Viburnums are wonderful, too. There are lots of shrubs that do well with shade/part/shade. I love hydrangeas-my favorite is the paniculata 'Tardiva'. Also love the oakleaf and the traditional blues or whites-Annabelle and Incrediball are lovely. Once you have the shrubs placed, add the perennials like hosta, heuchera, ferns (choose some that aren't huge spreaders or they will take over-ask me how I know), aquilegia, dicentra (I think it has been reclassified, but that is the name I always remember), astilbe if you can keep it moist (mine does best around the the bird baths where it gets watered every day since I dump the old and add new). You can add annuals for summer color and I bet some sun perennials would work next to your steps as well.

I am trying to finish everything here before I get too creaky to be planting and digging and going up and down the hill! Getting close to that point, I am afraid. It won't break the bank if you do it bit by bit or if you can enlist children and their friends to do the heavy digging and lifting-you can just point to where they should place things!

It will look fabulous once you get it done. I have gotten rid of most of our grass in the front, too, now. Love the natural look. Once everything grows in, you won't even need to worry about mulching!

My landscaping is a bit similar to yours. How about continuing with the "steps up" look, but with tiered height evergreens/conifers? Example - at the lower end, start with an Italian cypress, incorporate some pencil hollies, a Japanese maple somewhere in there for midway focus, an olive tree somewhere in there, and landscape lighting along your steps. Next would be to extend your steps out in another direction to enlargen the interest area.