I think I might simplify the area by removing the accent table and much of the smaller accessories - and add a row of art pieces stacked one above the other to the right of the television. See some examples below including one with a chair below it. It also seems there might be a third recessed can light going up the ceiling - ? - so light isn't an issue, correct? You might consider adding a trim to the recessed cans to direct the light back toward the wall to reduce the glare when you watch tv. Something like a wall wash trim with a stepped baffle.

I feel option A is better among all, except for the play area because you will be having a whole room downstairs for that. And maybe move the dining a little to the left near the window. You can add a partition to divide the room into living and dining and mount tv on it. Place a storage unit /crockery unit behind the partition. I would still recommend you to opt for the layout shown in the 3d renders as its quiet functional and space is best-made use of. Maybe instead of a tv on the wall, you can use a media partition to divide the living and the dining. The wall along the kitchen can be used to place storage units or shelving. Let me know if you need me to do more 3D layout to help you visualize better.

Thanks for the wonderful suggestions, the person that sold us the house left this tv stand. I have someone picking it up on Monday. I think it’s too huge for the space. My sectional is from Macy’s and it’s a 6 piece set, so I’m able to remove sections if needed. The fireplace has black granite and I think it looks horrible. The house also has very little light coming in. I will definitely be getting the LEDS that we’re suggested. The floors will also be getting removed. I’m going to put in some new ones. They are lighter and warm light brown color.

I love the art hung on the wall color you have. I agree that it is a little too long to work as well as it could over the sofa, but since you probably love it and will be using it, I would remove the clock (you don't really need anything above the art), and hang the art just a TINY bit higher. Like 2" or 3". What might work great on your wall would be a gallery of things so you could use the art in a grouping and not just lined up over the couch. It's the fact that it's longer than the sofa which makes it not quite right size-wise. Another thing that might work, depending on the rest of the room, would be to move the sofa to the right toward the door and flip the other couch to the left side. It would then form an L against the wall and the art could be centered over that arrangement of 2 couches (kind of like a sectional would look). Sort of like this, where the large art is hung off-set above the sofa against the wall and balanced by the 2nd sofa: