Personally I would not put moneyinto everything you mentioned. But maybe make sure you have a very good agent that can suggest what you talked about. If you don't plan to sell, for awhile, sit down with either your family, a contractor, to go over your list, (after you make one). a friend, etc.to see what would benefit you now. Yes some of the items could be corrected but from my view point, if the sales price is good, I would like to make my own choices on remodeling/adding/changing.
I see some good prospects from my viewpoint. Is this a two story house and would this be a place you could stay into for awhile--good neighbors? close to shopping? Medical?

When are you thinking of reselling? It sounds like you'd like to do these changes for you, too (I heard a lot of nonfunctional).

If you are going to live there a year or 2, I think I probably would consider doing it. Esp do it if you are going to put in the new flooring. If not, then leave plans and the carpet, both, to the new buyers, with a substantial discount in your sale price for the next owners to do it.

15x16 is still a sizable master in a 2300 sq ft house. 10x12 is even more sizable as a secondary bedroom (esp only a nursery).

What area of the country are you in? (I think this matters--are you in TX where "everything is big" or in the PNW?

We are in Balto county. Our area has mixed housing - new mega mansions down the street selling for over $1 million, but not too far from condo's & tract houses. Great schools. Close to major highways & shopping. But for the area we have a very unique property - 4 wooded acres sitting on the edge of a ridge surrounded by environmental protection land with streams. We will be here at least 5 more years. And yes, I do hate our layout because it just doesn't function well.

Each time we did a refinance, the appraisal came back and we were hurt by the lack of bedrooms. The only other neighbors we know of with 3 bedrooms (also recent empty nesters) are currently adding a bedroom over their garage - perhaps in preparation to sell?

Most tract houses in the area have slightly larger bedrooms than we would have after the changes so that does worry me. But the new room could easily become part of a master "suite" which would put us back where we were in terms of rooms and sizes, but with more flexibility.

Bottom line for me - I just hate putting any money into a bathroom remodel and all new flooring and not really improve the function or resale.

So my question is whether a huge master is more valuable than an extra bedroom and better storage space.

Huge master bedrooms are a fading trend. If you can do it without substantial structural changes, I'd go for the bedroom/office and more storage and better layout.

I'd do the changes, you don't like your present plan you are going to live in it for at least five years.
What are you waiting for, make it your home.
Is it all a good financial investment, maybe not, but you will recoop your enjoyment and probably get a decent return in the end. Four bedrooms are more valued and most buyers today want a home office. You will have all that.

Would the potential new bedroom have a separate entrance from the master bedroom? If that is the case, I say go for the fourth bedroom. If the only way to enter that bedroom is through the master, skip it.

Thank you all for your comments. It will probably come down to the cost involved - hopefully we can do it efficiently as part of the master bath/closet remodel. It seems to me that this is the right time to consider such a change. And the change is not only for resale's sake, it would make me happy because I think the space would be more functional. RRAH, yes the room will have its own entrance from the hall, but will share a long wall with the master so it could be opened to form a suite.

I would do it. 5 years of enjoyment is long enough for a simple wall change-over (assuming nothing is load bearing, but even if something is, the cost might not be prohibitive to make it work the way you want).

I did a remodel a year ago now and it makes me so happy. It just functions so much better for us.

If you will be doing remodeling anyway, add it in.

http://www.remodeling.hw.net/cost-vs-value/2014/

Remodeling for resale is rarely a wise expenditure. It costs you money, not makes you money.