This could be done. But you should follow these guidelines:
1. Make new tiles for it. Using the old ones won't work. they aren't made for a side-scrolling view obviously.
2. To solve the "having to jump over people" problem, just make it so you walk through people. Not very hard.
3. Maybe you could do it like Zelda where you are in overhead view or something when walking outside of forests and towns and stuff.
That might help.
