Our house had a bathroom in a space like that when we bought it. It was (a) not to code, and (b) not useful for my tall husband. We lived with it for 2 years and then demolished everything (not just down to studs - it was re-framed in a totally different configuration that allowed for actual habitable space). You really need more than 3' of width to accommodate the toilet and sink plus a pathway to the shower. The only other option I can think of would be to bump the wall into the bedroom by 2-3' to achieve that width. Or add a dormer to raise the ceiling. I usually advocate for creative solutions, but I don't think I'd spend time or $ to make a bathroom work in that space as it is.

It looks unfinished. Or like the old tongue-in-groove has been removed. I would finish it first. Blue is a traditional color for porch ceilings.

We've converted two attic spaces (same house, opposite ends) to living space, with low ceilings. From my experience, the first thing to do, after determining whether you can safely/legally finish the attic, is to run the electrical wires. To avoid running duct from a furnace/AC, I'd run 220v for a couple of baseboard heaters, and use the portable AC units which sit on the floor and vent through a window. I can see some natural light, so it looks as if you have dormers, which might be fine for egress and the portable AC units. We used foam baffles between the roof and insulation, then sheetrock as usual. If you are not confident about finishing sheetrock, and don't want to pay to have it done, you can tape it, then cover with inexpensive sheet beadboard. I like your floors as they are, but you'd want to seal them, if not paint. Those are much nicer floors than I've ever seen in an unfinished attic. I'm impressed that there are floor boards at all--I've see a lot of attics with a few pieces of plywood laid across the joists to store boxes. Since the knee walls wouldn't be structural, I think you could frame them yourself, with some research, and basic tools. You might as well frame them in, since that space is too low to use as living space, and if you feel confident enough, you can turn the space into recessed storage--shelves or converted dresser/drawers--very convenient if the space will be used as an office or craft room. If you choose the portable AC option, you could even tailor a storage space to the unit(s), for the off-season. Following are pics of some of the kneewall storage in our half-story attic addition. I did most of the work myself, with limited construction experience. (Left the electrical work to the pro.) The white walls, and closet doors, are the sheet beadboard I mentioned above. I also had to work around closet space in adjacent bedrooms, and the old roof supports, which is why the recessed shelves in the first pic are so shallow. If you can find cabinets, drawers, and chests on craigslist, Goodwill, and the Restore, you can keep the cost down--but only if you have more time, than money, to invest in the project. It would be very difficult to estimate the cost. Our neighbor is a master electrician, and we traded him a strip of land that he'd been asking about, to wire the whole addition. We already had all the tools needed. A chop saw/miter saw, set up in the space as I was working, was invaluable. Circular saw for angled cuts on 2x4 framing. Reciprocating saw for cutting existing framing, and a jig saw for small cuts is also useful. Framing and finishing nail guns are convenient, but I don't like using them, so I did all the nailing with a hammer. I love hearing a nail 'sing' as it's being driven into the framing. :) If you have friends or relatives with construction experience, who will do favors or trade skills, then you can keep the cost down. Kneewall storage ideas/google Portable AC units on Amazon

Can we assume those are basement stairs you enter by the back door? You might steal some of the head space at the east end of those so you could put an oven/micro tower there recessed just a bit so it doesn't close off that end of the kitchen. Then you can move the fridge to the right by the window and put a gas cooktop and hood right of the dish washer. I would do a straight run of lower cabinets on the wall with drawers. One set left of the sink, doors under the sink, w/d, then cooktop with drawers underneath, then a pullout utensil cabinet, and another set of drawers next to the fridge which will have shifted into the dining area. The wall of pantry from the back entry to the oven/micro tower will complete the south side of your drawing. If you prefer a range, then you'd just lose the drawer storage but could make it up by extending the 12" pantry further into the dining space. Drawers under gas cooktop Utensil pullout A variation on these would extend all along the south wall or could stop to allow for a tower for an oven and micro and the dining end.