Take a moment to think about what activities you will be doing in this entire space. Watching tv. Cooking. Playing board games/cards? Eating? Hobbies? Reading? Visiting with family and friends? You've got the kitchen at one end and the tv watching area at the other. In the middle, you could have a game table, or a dining table, or a reading nook, or a craft area. Or a "swing" area, that's good for meals and hobbies and games, depending on what furniture you use. So my suggestion is to look at the house as a whole, and figure out the best uses for this space, and furnish it to support those uses.

Put TV on the wall where the circle mirror is. Float the sofa facing it and place the two chairs right and left of the sofa, facing each other over a coffee table.

My last house was a row house. I sort of had an overall aesthetic for the whole space, starting with a warmer version of the palette in the living room and becoming cooler towards the back. I actually had bold wallpaper in the dining room which came with the house, and since that part of the house had the least natural light, I liked it. Not saying I would repeat it, but it is one way to go. In the end, the dining room walls ended up being covered by storage units that were practically wall to wall, so if I had to do it again, I would do as the original comments suggest, just stick with a neutral wall color and punch up the room walls with art. Cool art can go with you when you move too.

The (real, licensed) architect drew in the same layout we’ve seen in suburban model homes everywhere. He freely admitted that these layouts are not his strong suit and didn’t want to spend any time in it. I didn’t share the drawing because I don’t want to get hung up on tweaking the original idea. I thought starting with a blank slate would inspire more creativity. Also, I’d prefer to have a round dining table for better interaction when we’re all together. I’d also like to avoid placing the TV above the fireplace if there are better alternatives.