You spend about 4 of the 6 chapters in an urban environment, one chapter in the wilds, and one chapter in a ruin/dungeon. Making an urban-focused character should be OK - just make sure you have some general adventuring ability in the mix.
Exactly the advice I was looking for! Thank you very much!
If by "Urban" you mean "actually having social skills, instead of the typical murder hobo PC", then yes, I highly recommend it. Without wanting to spoil too much, there are many encounters which can be resolved without violence.
I encouraged players in my group to make characters with some "roots" in Korvosa, the city itself is a great setting and feeling like it's part of your character's heritage is pretty rewarding. It also makes things a bit more real when (spoiler alert!) some bad things happen.
I would recommend reading the Players Guide and following the character creation advice therein.
Remember that this AP was written for OGL 3.5 and that only the Core Classes were available at the time. This guide is also where the first iteration of Character Traits rules were first introduced, and most of the ones presented were later revised greatly.
But the best advice would be to check with your GM.