(Credit goes to post from reddit:reddit.com/r/SimCity/comments/1a4j2f/compiled_list_of_transit_tips_from_developer/ )
Traffic Pathing Algorithm
Take your road network, and imagine there are dozens and dozens of D* graphs getting built all the time, one graph per destination type. Some of those are pedestrian destinations (like a house, workplace, shop, etc...) some are "transit" pedestrian destinations (like a bus stop that will lead you to a house, a street car stop that will lead you to a workplace, etc...). Those are used by the pedestrians and the stops to figure out who should go where. Then there's a bunch of sets that are used by the transit vehicles themselves, like "pick up shuttle passengers", "pick up train passengers at a neighbor's", "drop off streetcar passengers near a workplace", "drop off muni bus passengers near a home", and finally, "go from stop to stop". Whenever a transit vehicle makes a stop, it drops off all the passengers that can walk to their destination from it, then pick-up passengers. In most cases, if there is still room for passengers, the vehicle will try to go to stops that have people waiting. If it's full (or with a small chance if there's still room) then it will go straight to the first valid drop off point in a list, based on its passengers desired destination. If it's empty, then there's a chance it will drive at random from stop to stop, until it picks up people. Hope this helps figuring out how to play the transit game!
If you use the guides, then you should get the right amount of space for back to back medium and high density buildings (they have the same depth). Sometimes it helps to be zoomed in when you draw your roads, as the guides tend to be followed more precisely than if you were zoomed out.
Also, when you load into a city, all the cars, pedestrians, trucks, buses, etc... start from the unit that originally emitted them again -- their location on the map isn't saved.
Mixed Zoning Do a search for Horizontal Mixed Use and Neighborhood Commercial, those are the two types of mixed use zoning the game supports.
Work buildings send requests to residential buildings at 6am and 6pm (for night shift/continuous workplaces), but only for a portion of their workforce, say about 1/3. Neighbors will also call for workers at those times. This is so you get the rush hour effect. People will decide to walk or drive based on the distance between the workplace that requested them and where they live. If you build your city so you tend to mix zones, then you can effectively create a walkable city. Then for a few more hours, the rest of the workforce will trickle in. You can speed up that process by building public transit.
Street Car Design
...definitely on the right track in being disciplined and building his streetcar system as 1 line per depot, as opposed to a spaghetti dish.
Don't place your streetcar depot so close to an intersection. Seriously, don't.
Keep buses on avenues and off smaller streets. Place bus stops on both sides of the road (so they're paired) to limit how many U-turns buses have to make.
You need to balance the number of buses you place with the number of stops as well as the complexity of your network. Not enough buses, and people wait a long time. Too many buses, and your streets get flooded by them.
Sims don't know which way the bus is going, they just know that if they go to this stop, then they'll be able to reach their eventual destination. People will walk to park & ride, yes.
You should also put the pairs farther apart from each other, each stop can cover about 400 meters each direction.
Eventually the bus will go back to the garage, at which point the Sim may walk back home (or take transit back home)