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in Wildlife gardening
I think your sparrow terrace will be ok on the back of your house - my garden's not that much bigger than yours and sparrows nest in the roofs all around here, and we've got lots of bird feeders in our garden and so have the neighbours - I don't think sparrows are very territorial. Robins and blackbirds are very territorial so I wouldn't expect them to nest too close to a feeding station - that being said, at work I have a feeding station about 10 feet from my window, and last summer a pair of robins nested successfully in the climbing hydrangea underneath my window.
We've had viewers in one of our tit boxes this year, but nothing happening yet.
The new box should be put on a North Facing wall as well so it's out the way of the sun according to the RSPB as the rays of the sun be it morning or afternoon does have quite a lot of heat in it and therefore you could bake the eggs/chicks on anything other that a North wall
My understanding is that east or north facing walls are ok - this might be helpful
I would fix your nest box and leave it for the birds to decide if they like its position. Its better than not putting it up and never knowing. Give it a couple of years before expecting any birds to nest in it though.
choosing the best bird house design is difficult especially as a placement may effect another bird's environment/territory.