I've actually had that same idea in my head for awhile too now but I think cichlids would prefer some hiding spots whereas iwagumi have a majority of open space. Perhaps some careful hardscape planning would provide some cover or you could just keep one pair. I'm attempting the same thing and so far I have the hardscape set out, now I'm deciding wether I should keep a pair of shell dwellers or begin dry start.
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I have to echo this advice. As beautiful as it may sound in theory, unless you provide plenty of hiding places I personally feel that they will be very unhappy fish and will show it. They will retreat to corners or any viable space to hide. Too many cichlids and they may fight it out for these spaces. If you get one, or a pair, that establish dominance in an Iwagumi, good luck to anything else in there if its all open field. That is just my opinion though. I've only owned Kribs, Rams, and other Apistogramma variety.
A lot of it has to do with space, while there is also light to think about. Lots of light growing a carpet with little space to hide will be rough on them. What spaces you have will surely be filled and your beautifully colored fish won't shine.
It didn't work for me anyway. My wannabe 40b Iwagumi turned into a hygro/crypt/anubias jungle as I rehomed all fish to a dark low tech 36bow. The Iwagumi was a fun concept for me, but I personally decided that I required more variety in my plants, and my fish are happier in a different environment. When my jungle is finished I may raise a few krib fry in there, but I really like the 100% control of my plants with no fish in there. I'm cranking this co2 right now!
And Alex009 is correct, some species will eat up your plants!
That's isn't to say you can't try it! Pick your scape and fish and give it a shot! Worst case scenario is you are trying different fish/scapes over a short time until it looks and works good.