Power supply for LEDs

As Crossroads suggests, if you use 3 TPIC6B595s, not only do you cut down on wiring ( only 3 wires to the Arduino board ) but you could also use 4 wires and dim them with pulse width modulating the blanking pins of the TPICs ( notG pin ).

We don't know the age of your " village" but it would leave spare pins for sequenced traffic lights, shop windows etc ?

And as Grumpy Mike suggests, if you use a seperate power supply, once you have it running you can put a 24 pin socket, a 5 volts regulator, a few caps and a resistor, and you have an embedded micro, to free your Arduino board....