I'd do the powder room. It's where people want a powder room. That is, in the reception area of the house. When you have a houseful of company, you'll have them using the guest bath and master as well. I only have the powder room on the main level, and people climb the stairs (they do ask) rather than waiting. Family members don't mind, but others feel awkward. I know some people make do with one bathroom for a huge family, and lots of people around the world don't have any, but I still vote for the powder room. You have a good sized kitchen. If you use it as a pantry, what all will you put in there that won't fit in the kitchen? Unless you're a lover of little nooks, the desk idea sounds like it would become a dumping ground. Romantic in concept, but a pile of junk in most people's reality.

The pics came through now. Both sets. Seems like they get stuck somewhere in cyberspace sometimes and take a while to show up. It is very hard to see the layout and possibilities available to you with all the stuff around. Spend time in removing the clutter first. Remove it from everywhere including all the horizontal and vertical surfaces. Once that is done, it will be easier to see where your furniture should go to maximize the breezes.

Without an actual to scale plan of the space there is no way of knowing what will fit and I love the low cabinet with the art BTW. I think you might be able to put a round table in the DR but I need measurements of the spaces I never like fake greenery or flowers and the mirror is really not reflecting anything worth seeing twice

The living furniture seems to be confined to some invisible boundary! Turn the area rug 90 degrees and spread the furniture out a bit. Add another chair at the closest end, which will fill some more of the empty space. Once you change the floors I would move the chandelier further up the ceiling, again to give your dining furniture a bit more breathing room.