The removal(conversion)of grass can be accomplished fairly easily by the lasagna method.
The slope can become a rockery. Some of us go to great lengths to create a slope, just so we can place the rocks just so.... Rai

A rock garden? and search for proper plants. All kinds of alpine plants. Lucky you.

serenityewart, I have a similar situation. One gradual slope under a giant pine tree and I have fallen twice on the pine needles (and at my age I can't keep that up!)... and the other is a steep slope from the yard down to the road. Unfortunately the state sprayed this with grass seed which was all weed seeds. Constantly trying to decide what I want to do.

I have decided for the front that I should try to cover the entire banking with something to kill off and prevent the weeds. Was thinking of layers of newspaper/cardboard under a layer of black landscaping fabric and/or burlap. Then I was going to cut holes where I wanted to plant and improve the soil there only... plant the hillside with groundcovers then mulch the whole thing with wood mulch. This way I don't have to remove all the weeds and grass or improve all the soil on the entire banking. Also it should stop erosion.

On the gradual slope under the pine tree I decided to put in some timbers to create gentle steps up to the hillside and plant shade lovers along the sides.

Your idea for a cottage garden in the sunny space sounds great. I wouldn't bother ripping up the grass. I would cover it with something and let it compost away into the ground...then plant through the covering to create your cottage garden and mulch. Poppies, daisies, lupines, mallows, beebalms, daylilys, rudbeckias, veronicas, yarrow etc would work great. All of those self-sow or multiply freely and make beautiful massive displays. If you like roses maybe some of the Fairy Roses or the carpet roses would add to the cottage look. You could even place some "stepping stones" curving up the slope to an rose-covered arbor at the top.

For the shady area there are also tons of plants. Hosta, bleeding hearts, ferns, pulmonerias, astilbe, tiarella, viola, toad lily, heuchera (especially the yellow leafed ones), cimicifuga ramosa, lily-of-the-valley, brunnera 'Jack Frost', etc etc.

Your sloped beds are a great place to tuck in a rock or boulder here and there, a half-buried pot or wheel, a piece of driftwood, etc.

Hope this gives you some ideas.

My friend has done this and it works well, put in a few boulders and lots of perrenials, the above suggestion will work, some bushes too, throw in some cosmos, they will ressed themselves, it looks a lot better that grass and it is easy to maintain.

I have the same problem, except its my back yard, leading away from the house. I also need to deal with drainage issues from the gutters, and was thinking of putting in some kind of water feature from the down spout from the gutter...to encourage the water away from the foundation.

I have the same problem. Since I am a lazy gardner I did not remove the weeds and grass (figured I should leave them to hold the dirt in Place) and just started planting daylilies,coreopsis, a few shrub roses, and hosta at the top since this bank is topped by a row of white pines. Each year I weed out the grass and weeds as plants take over. This year (I think it's been 4 years) everything has taken over and now in the process of rearrangeing what I have. I also put in some rug juniper and creeping phlox at the base. Be careful if you use coreposis, it is very invasive