I've looked at the fabrics. Fabrics are SO hard to choose, for a lot of reasons. One thing I learned when I was doing this for myself was to absolutely NOT select a fabric without seeing it in person first. They look completely different in person. You want to hold them up to furniture in the light of the room in which they will be. Light affects colors and fabrics dramatically. If you're doing this strictly online, you should be able to request swatches from Smith Bros. Better still, if there is a retailer near you yo can actually walk in and look at the large swatches and take some home, do so. Other considerations. Cleaning. It is my understanding (someone please correct me if I'm wrong) that the fabrics that are 100% man-made materials ,i.e.: polyester, acrylic, etc., are very hard to clean, that you want a fabric which at least has some cotton or wool or whatever in it. Also, you want to feel the fabrics so you'll have a sense of how comfortable it will be to sit on. Will if "feel" too cold in winter? That sort of thing. And wear: you don't want to have to reupholster the pieces in five years! Re: the fabrics you picked. Love, love, love 334211, the chair fabric. Beautiful. gorgeous colors, and it'll look stunning on that carpet. You absolutely can do the entire chair and ottoman in that fabric, and should, IMO. I love the chocolate brown/muted gray/blue color combo. Didn't particularly care for the second patterned fabric you chose for pillows, but that's just a matter of personal taste, of course. I do think the two patterns clash. re: the sofa fabric. I'm really not sure about it. It strikes me as being too dark for the carpet you've chosen, but it's hard to say w/o seeing a swatch in person. I think that with such a dark carpet, I'd want a bit more of a contrast. I think you're right, though, to go with a "railroad" pattern for the sofa, rather than jacquard or floral or whatever. I believe in being conservative with sofa fabrics (so they won't get dated and need to be recovered fairly quickly) and dressing sofas up instead with pillows and throws. Okay, I've gone through all the fabrics, matched them back and forth by using multiple windows, and this is what I came up with. For the sofa, purely by coincidence, I kept coming back to #329511, and it's the only one I settled on. It also has some cotton in it, which is good for sofa fabric. It'll look stunning on the dark brown carpet, and it goes very nicely with chair's 334211. The herringbone pattern gives it some texture, which you will like on a large piece like a sofa. For the sofa pillows, I love the Palm Island counter fabric, 334311 OR the same fabric you'll have for the chair, 334211. These fabrics contrasting with the richness and starkness of the deep brown rug will be gorgeous, in my opinion. but again, ALWAYS look at swatches in person before making a final decision. If you were to get a set of wood slat blinds for the two windows on each side of the fireplace, I think that would be the icing on the cake for that room (see link). Room with this color combo and these blinds would be warm enough in winter, cool enough for summer, serene…just beautiful, IMO. and why won't you use the wood-burning fireplace? Oh my! You must! Just remember to close the flue in the morning so your heat doesn't escape up the chimney! It's gonna be gorgeous, Carol! Here is a link that might be useful: Fireplace window blinds

Thank you for all your suggestions! All were great ideas! So this is what Im going to try. Leave the current setup in front of the TV and just bring the sofa in a bit more to make space for sofa table and then creating another seating area with 2 chairs flanking the fireplace. Also move the chaise near the bar with a floor lamp. Perfect! One last question, should i place a small rug in front of the fireplace area( maybe a round one) or leave it?

Picture of room with previous owners’ furniture/layout

The stove is gas and we've never used it. I would love to tear out all the brickwork but the original chimney is walled off behind it so it would be a huge, expensive project if it's even structurally feasible. This house has a lot of projects and the main level is my priority so the wet bar will have to wait even though it would be great to have that done. Maybe I can find a slide to attach to the wet bar...they climb on it anyway...and then put the climber on the back deck if it will fit. My boys play outside a ton when we have snow, but 2/3 of the winter we have no snow and apparently it's not so much fun to play outside when it's cold, windy, and dry. We did have the room open for a playroom when we first moved in but then DH insisted on getting that sectional. I would have preferred just a couch and more open space. Maybe if I split the sectional up I can make the room more open again.