A great big sectional may look great in the drawing, but it won't let me n this room. Smaller houses need smaller upholstered furniture.

Furniture placement is key to a great functioning room. Question, is this a "great room" situation or do you have a living room and a family room? If you have both rooms, I suggest no TV in the living room. If the TV will be in the same room as the fireplace, and there is room, consider built-in cabinets on either side, or one side of the fireplace to incorporate the TV and accessories. If you can't afford built-ins at this time, as new homeowner's are usually low on cash, you might be able to find a nice TV cabinet that will work. I prefer a nice piece of artwork or a mirror over the fireplace. When placing furniture, consider the view, if any, and how the room is to be used. Never put a sofa in front of, and with it's back to a window. A very simple setting would be a nice sofa, two lounge chairs, coffee table, side table, and possibly floor lamps. My philosphy is to never buy a "set of furniture". Do an ecclectic mix. See one of my client's homes below. All the best to you in your new home!

I would set the room up pretty much the way it is in your photos except I'd use two sofas instead of a sectional and I'd put the TV to one side of the fireplace instead of over the mantel. In fact, your fireplace has a typical craftsman configuration, so I'd consider doing built ins on both sides and have one of them configured to hold the TV.

Creating 'flow' is all about coordination. That includes soft coverings (window coverings, pillows, floor coverings, etc). Your drapes are the beginning (and in this setting, the end) of the coordination effort. The two sofas in two different styles and two different colours create a hodge-podge sitting area. I would start with figuring out the style you wish to portray. Once you have that fixed, then figure out a colour scheme. After that, you will want to move ahead with the soft coverings. An area rug that compliments the drapes (you will want to get all three sets of drapes coordinated) will go a very long way. But first the big stuff: style. Either the orange modern sofa stays or it goes. Everything else appears to be traditional. The large brown sofa - being over stuffed - is in opposition to the orange sofa. It is 'over stuffed American kitsch'. You will need to choose between the two. That's where you start.