Hi, TC!
I agree re knives and passenger SA etc. The "surprise & startle effect" would make it very probable that the passengers would freeze or panic with the sudden shock of the situation. Untrained pax are never going to be able to react quickly enough even to find the knife, let alone use it correctly.
I think the obvious answer here is that you need a trained crewmember in the back ( as happens on 99.9% of commercial flights ( talking fixed wing obviously) -to take charge and get the pax out in the event of an emergency.
In NYC like London, you have the equivalent of heli-lanes over East River and the Hudson, so an aircraft can autorotate to a relatively clear (if wet) area, where it is not a danger to people on the ground. I cant see another solution unless you are talking mandating twins over the city, and that is highly unlikely. If you look at the probability/ frequency of engine failures, it will come down to costs vs benefits, and money talks!