It’s asking a lot to make this a tv room, playroom and music room. So Maybe add a colorful area rug on top of the carpet and some fun, colorful kid chairs for now. Once the dollhouse is outgrown, a sofa with flanking chairs on the big wall and move the piano where the tv is now. I can just see the kids dancing to music played on the piano! Takes me back....

You will have to live with the duct, but if you do everything in an industrial style, you can make it work. For instance: These furnishing would be pretty easy to copy.

Just some screenshots I feel relate to your I feel like if you can get one sectional instead of all the different couches it would look better, behind the sectional you could place a sofa table with a couple lamps ect. and a end table at the other end. This shows a TV in front of the window. You would not mount the TV, the console would ideally be slightly wider than the TV, it would also be elevated off the ground to allow air space, you would also set up your curtain rod to be the width of the TV console (which should be high enough to cover the length of the curtains) this way they don't need to reach the ground but remember they should be hung as high as possible, then put some blinds on the window, and it would be nice with two bookshelves too. Everything needs to be lightened up to open it up, move away from the black and dark furniture pieces. If you end up having room at the end of the sectional possible you could fit another accent chair, and you should be able to keep the small hall tree/ coat hooks space at entry.

You might look at centering the TV, removing the ladder and placing a plant there instead, and for the open space you could try a large piece of artwork over a console or a bar area. Please see our pictures below for more ideas: