Paradise City is an afterlife for cars.
Its name suggests as much. This explains why we never see any human drivers or passersby: there aren't any. The entire Paradise City is a sort of motor Valhalla, where scrapped trucks, limos, jalopies, and their kin, can blissfully race, leap, crash and ram without a care for all eternity. The junkyards are simply places where cars can incarnate into new bodies whenever they wish. The human figures on the billboards are there to add flavor, while DJ Atomika is the name of the spirit that governs this auto afterlife. (Granted, the existence of the bike missions (with a clearly visible driver) contradicts this theory a little; but then again, they were only added in a later update.)
