I'm currently playing a city-based rogue/paladin that got an exalted feat (Sacred Strike) instead of a mount at 5th level. I headed into a prestige class after that, so I'm not going to get anything more, though I don't know what the DM planned on doing.
Seems to have worked pretty well. For a city-based game, a horse is quite useless. There was some consideration of a celestial ally (a hawk, I believe), as well.