You might consider moving the sofa to be centered in front of the window and put the chair nearer the door adding a pony wall height bookshelf (with its back to the chair), with or without doors on the entry side, between the chair and the door to create an entry; perhaps something like this: http://thegamersforce.com/ikea-glass-door-bookcase/bookshelf-inspiring-low-bookcase-with-doors-bookcase-with-doors-ikea-dark-brown-bookcase-with-glass-glass-door-ikea-bookcase-singapore-ikea-glass-door-bookcase-ikea-billy-bookcase-glass-door-instruc/ A barrister style bookcase could also work. Such a room divider would give you a place to add a lamp to the room.

Chess-yeah that's me - yes, that is exactly right! the owners dad built it about 70 years ago. Jamie Ludwig - I posted some additional photos that did not seem to upload before Saypoint - Was thinking I can't do seating on either side of the door because on one side you have fireplace and the other side is the entryway to the other room. We tried the sofa facing the fireplace but it did not seem to work well as it felt like you walked into the sofa when you came in. Also tried the sofa in front of the tv with the back to the door but then again felt like you walked right into the sofa and it was too close to the TV.

Don't center a rug in the room -- this is such a large room that it needs to be subidived into two spaces. Set up a seating ensemble around the fireplace and bookcases (put a TV in the bookcase if you want it in this room), with a couch (facing right), couple of chairs, coffee table, and your rug turned 90 degrees to unify that space. You could put a console table behind the couch to give it a more welcoming face (maybe even with drawers for mittens, or a tray for mail, etc.). Then put your bench under the window to the left of the door, with a coat rack in the corner, boot tray underneath, etc. -- I think this "mudroom" zone will actually just need the upper-left quarter of the space, and could have its own rug. That leaves the lower-left corner for one more functional space: could be a desk and chair, or a game/puzzle table, or a bookcase, reading chair, lamp grouping, or some storage pieces with art. That should put you in good shape. I'd consider reversing the door, as it would feel more natural for the mudroom purpose as well as being less restrictive of furniture placement...

I think you have the best set-up the way it is. I’m just picturing a busy family or if you were entertaining .... with some trying to watch TV, others going back and forth from the kitchen to dining table and back to kitchen, past the living area. It seems like it could end up being noisy and chaotic. I’d just rather have the living room further away from the kitchen. But you live there, not me ... you know best how your family would use the spaces. :)