I would move the tv to the wall where the couch is now. Move the couch opposite, with its back to the sliding door. Consider adding a sofa table behind with a pair of lamps to bring more warm lighting into the room. Keep the small chair where it is on the right side of the fireplace, and use the floor lamp next to it. Put the chair and a half and ottoman to the right of the couch, the end table and lamp beside it. Move the whole arrangement a bit closer to the fireplace, and make sure that the front legs of the couch and the chairs are on the rug. I agree that the coffeetable is not the best choice. I would love to see something round, perhaps a wood or slate top, with iron legs so that you don't have so much heavy furniture in the space. Down on the end wall where the tv is now, I would think about a game table and chairs in the corner where the screen is, great for snacking or playing games or doing puzzles. I would find a new home for the screen. Then a group of bookshelves with some closed storage in the same finish as the tv cabinet to the right along the wall to allow for storage of some of the toys, as well as a place to house books and media. Take the clock off the fireplace and use that on the end wall where the game table will be. Use the canvas you have on the fireplace, to bring some of the warmer colors of the room onto the grey fireplace. If your DH doesn't want to paint the fireplace, check into staining it. Just giving it a warmer finish would do a lot for the room.

Once you have furniture in your space the chair rail will not be noticed on that side. It will not be the focal point. Your furnishings and artwork will be what people will see. Also, spaces that are completely balanced are not nearly as interesting as having a little asymmetry here and there imo.

@BeverlyFLADeziner I am liking that! Any suggestions on a blue paint color? Thoughts on if this rug could be placed in the room? (Pic of our current family room) or too much blue? https://www.potterybarn.com/m/products/bosworth-tufted-wool-rug-blue/?cm_cat=Google&sku=9076063&catalogId=84&cm_ite=9076063&gclid=EAIaIQobChMI0cX79KG96AIVOv_jBx1m0gEnEAQYASABEgLD-_D_BwE&cm_ven=PLA&cm_pla=Rugs > Patterned Rugs Any chance you could make fireplace maple again but keep everything else blue? I like the idea of keeping that to tie in to kitchen. Thank you!!

I would put a reading chair and end table by the fireplace and the rear window, then a sectional along the wall facing the tv, and get rid of the second end table. You need to leave space at the end of the second for traffic flow. Or I would get a carpen to build a custom unit on the fireplace wall that incorporates both the tv and the fireplace and then have one large curved sofa facing that unit and ditch the mesa cabinet (but have a big coffee table). What is behind the curtains?