The rise in your ceiling is so gentle that I don't think it needs to be featured. If you are choosing a soft neutral color for your walls, I would paint the ceiling the same color, to make the shape of the walls seem more natural. Your room needs better lighting almost everywhere, and I agree that you need a larger, lower chandelier over your table. I'd also recommend the following steps, before you make a big investment in furniture. Move the big picture toward the corner cabinet, so that its center lines up with the center of the table, and hang it lower, so that the top of the frame lines up with the top of your china cabinet. If your corner cabinet is not a valuable antique, paint the inside to match the wall, which will lighten the look of that corner. Take everything off the top of it, too. Try shifting your loveseat another foot away from the wall, and move the console that is now along the long wall to stand behind the loveseat, facing into the dining room. Use that wall like an art gallery, and cover it with pictures you like, and your children's drawings in inexpensive frames. Add a more substantial end table between the loveseat and the wall, with a larger lamp. Try shifting your larger sofa forward into the room, at least a foot away from the railing, add a skinny table behind it, and a nice pair of floor lamps to stand behind the outer ends of the sofa. Find a big, rectangular mirror and hang that vertically over your drop-leaf table in the living room. It will open that wall visually, break up the space, and reflect light from the window into the room, as well as add some sparkle and glow. Consider replacing the two unrelated shelf cabinets in that end of the room with a pair of very tall, slender bookcases painted to match your walls, perhaps with a deep contrasting color inside the boxes. Move everything that's now in and on top of your two cases, as well as all the photos on the table, into those bookcases, to unclutter the surfaces, and pull all those things into some sort of order. Then you'll have room to put a lamp on that table as well. Those changes should pull your nice things together better, and solve the light issue, and then you will know what else you want to do.

You're correct that this is a challenging design. Here are some possible solutions. You seem open to replacing your furniture, so that is my first thought: --Replace both sofas with comfortable armchairs with tallish backs that can be floated in the middle of the room around a coffee table. This will greatly add flow around the room so that you're not blocking all the inconvenient doorways. Note how a dramatic light pendant centers the seating. With the height you have, a beautiful pendant would have an incredible effect in both lighting the room and bringing down the scale to a more comfortable height. You have warm, wood floors in a beautiful color. Have a wooden bookcase in the same finish built to the left of your fireplace that can accommodate your TV. Have it built to the height of your mantel. Alternatively, get a very wide console, not too deep, for the TV. The one you have is too small and doesn't link in any way to the finishes in the room. Get an oversized large square or round rug for the room in a pattern that picks up the warmth of your wood finishes and echoes whatever upholstery you eventually choose for your seating. All art work should be hung at eye level regardless of how high your ceilings are. That means the center of each piece should be around 57" from the floor to the center of the art. Pair your daughter's paintings side by side at eye level. Lower the art work over the mantel so it's about 6" from the mantel so they connect. If you love that piece, or your daughter's art, then choose your future furniture palette--upholstery, pillows, etc. from the art. (This chair is the same silvery blue as in your painting. The legs are in similar wood finish as your wood floors and trim. Four similar ones--or these--around a round coffee table would look wonderful and really function well in the room.

It’s a VR pic that’s why the floors look curvy. Thankfully, they are flat in reality.

Draperies that start at the tall ceiling and go down to the floor would look beautiful, add interest, warmth, and life to the room. But they cost a lot. I will link a thread with a lot of pics and suggestions. https://www.houzz.com/discussions/5796508/window-treatments-for-2-story-great-room-windows