Each step needs to be deeper so the total area taken up by the stairway would have to be greater. Essentially the entire stair has to be rebuilt starting from the top allowing for a 10" deep tread (plus overhang) and 7" rise. You could make it somewhat less challenging by reducing the number of winder steps from four to two, rebuild only the bottom section and add 2 treads at the bottom. This would make the stair stick out at least another 20", blocking whatever's to the left of the door where the carpet starts. Done correctly this stair would probably extend through that doorway.

If it's within your budget, one idea could be to add a built-in banquette where you have the bench currently. I would run it along the back wall with the window (from about where the window ends) and along the bench wall. This would give you a bit more seating, and then perhaps your table could run a bit longer. I really like the paint color as is, but nice bright white to match the wainscoting could feel really fresh as well. Do you have any collections of kitchen-like things? Maybe glass bottles, or old kitchen scales....it could be really cool to have some shelves on the wall between the window and the corner and showcase any sort of collection you may have. For the larger wall you could do a photo gallery wall. If you stay with the same paint color, I would go with white frames. If you lighten the wall color, black could be nice to tie in with the fireplace. I'll attach some photos for ideas. Good luck!

edenchild, I bet you could find fancy stuff online or in an upscale sort of store if you wanted to... but just the basic stuff a local fabric store would have would work just fine. Most fabric stores sell felt by the yard in basic primary colors, some pastels, and sometimes some prints. Get it by the yard, it comes in different widths, but common around 36 or 44 inches, sometimes wider- then you can cut it to whatever size you need it and you don't need seams or anything to finish the edges. Don't get squares or sheets of the stuff, you got too much racks to play with that. If you want, you could pick something bright to add a wee pop of color to the shelf fronts while still being functional. Red would be traditional, but light or bright colors would be nice too. Cut the felt to be barely inside the depth of the shelves, draping over the front edge is a PITA and usually looks like tacky crap. But do be sure to leave yourself with a few inches of drape on both ends over on the width of the shelves, gives you shift room for bottle movement as they get added or removed from the shelf. To do this... and use a fabric tape that's soft and not a hard ruler or metal measuring tape... measure the depth of your shelf just inside the braces, and that's final. Then lay the tape across the width of your shelf, using a bottle in each slot to make sure the "dip curve" is accounted for, and use that for your width measurement. Also... you might not be one for chardonnay since it's a white, but since you like reds... watch your cabs and pinot bottles. Some of them have a slight taper with the bottle and it's better to store them punt facing out instead of the wall if you stack your bottles on top of each other. Again, vibrations can cause a slide, and better to slide into the wall instead of onto the floor.

Your idea books show your love of traditional library decor and rich colors. I think. That your current wall color, however, clashes with the lovely color of your new sofa bed. And you do seem to have too much furniture in the room at this point. I think that I would, first, strip all of your wall paper and prime your walls. Then I would fin a traditional oriental style rug for your room and center it. From the rug, I would choose a complimentary color for your walls. Then....I would begin to build your room. The perfect location for your “library area” would be in the nook where your sofa currently resides. The entire wall could be book shelves. What kind of storage does your room require? (There is no closet.). Do you need the little glass cases in the corner? If you need a dresser for guests, the large dresser will work. You could place the tv on it or hang it on the wall above it. Your sofa needs end tables with reading lamps on it. I think the sofa would look best on the top wall in the room. Centered. The TV on the left wall as you enter it. And the room could use a chair in which to sit and read, too. Located close to the window with the radiator on the right, and in front of your library wall. This is a one step at a time project. But I would start with finding a lovely rug for your room that works with the sofa. Good luck!