I've been watching the discussion trying to figure out the DIY City's wavelength.
I think part of what we see emerging on the local (neighborhood) Issues Forums hosted by E-Democracy.Org fit your model of citizen problem-solving. My experience is that at the very very very local level people will pick shovels and do stuff, while up the chain people prefer their tax dollars to do the work so they don't have to be bothered.
On my local neighborhood Issues Forum - http://e-democracy.org/se - we've had people start community garden efforts, ask if people want to do a blood drive and then promote it, suggest and then organize a volunteer lake clean-up (only to run into trouble getting connected to the right person in the parks department for permission), buy flower bulbs in bulk for their homes with some left over for public space, etc. Recently, a mugging at a new local light rail stop generated a flurry of activity: http://blog.e-democracy.org/posts/355
Anyway, since a number of you will be at Participation Camp, I thought I should say hello. If any of you would like to talk neighborhoods online to gather tips from 15 years on the front lines of e-participation, check out the two sessions I'll be leading or virtually note - http://e-democracy.org/if - for an existing Webinar and some links here: http://pages.e-democracy.org/Social_media_in_local_public_life