I would use the fireplace as it was intended to be used in my opinion. For the mortar you will need to re point the crumbling joints. To get it to match you will need to go over every joint. You will need a re pointing trowel that you should be able to get at Homeless Despot and a bag of brick mortar. Dig out the loose mortar in each joint. Mix to a toothpaste consistency and trowel the new mortar into each joint. Before completely dry you brush it out with a stiff bristle bricky brush. Or hire a local brickmason. It's not rocket science and if it doesn't look right start over once dry.

Thank you everyone for the responses! I have attempted to respond 2x so far and it isn't showing up...I'll write a shorter response and then reload the computer to see if that is the issue. To answer your questions (quickly): I apologize about the sample quality. I posted the photo to show the shape of room and give you an idea of what we are working with at the moment (obviously, still working on it). I didn't even think that maybe you guys would zoom in on the pictures! I will put a higher quality one. I"m sorry they were so horrible/terrible. Thank you for the suggestion to use Duraseal/Bona. I had wondered if that was a better option but hadn't started researching. I was playing around with the minwax that I had at the house. I will def look into the Duraseal provincial. I think it's more like the color I imagine in my head. My only concern is that it would be too dark but that's what samples are for! The floors will be pine. We aren't in the position to get other wood right now, so we are going to deal with the yellowy color but it's the best we can do. fortunately, pine was common in farmhouses around here, so we aren't too far off base (I don't think so, anyway...) I am going to re-read everything and get back with more answers. I'll find a better quality sample pic. Sorry again - I didn't realize that you were looking at them!

Probably a very old chimney that needs to be lined with metal (not sure what kind of metal) because of small cracks. That's what ba few friends ended up having to do on older homes they purchased. Definitely get someone professional in to look at. A few went with a direct vent gas fireplace (must vent to outside wall not chimney) rather than expense of repairs on chimney. My sister just got a new fire box replacement, one with fans and heat vent, for a efficient heat source rather than a more traditional one. He is very handy, built his own home and cabin. But he would not take on that project. Cost was around $7,000, which included whole new liner. It was replacing his fireplace bhe had for 25 years.

Rachel - thank you - you shared great photos - I will post pictures next week after the walls and trim are painted in Dove White. I really like that black paint idea on fireplace- such a bold move but I love the white fireplaces you show which seem safer. Black happens to be in the wallpaper I am currently hanging in the foyer today. Pics attached. Changing trim and walls white all over the house is a huge transformation from my dingy dark trim and walls and I am creating a monster that is snowballing. The dining room rug looks horrible with my wallpaper so I am now in search of a new rug there and one for the family room and now I need new furniture in there as well. Suggestions are welcome from anyone - It is painted Dove white and you can see the new foyer paper with the new blue study. What about a blue or green velvet sofa with all white room. I have 2 cats and someone said that they are not as attracted to velvet. I am not painting the built-ins around fireplace just yet because I have not picked out kitchen cabinets. Maybe I can have the built-ins sprayed white or the blue??? I could also try to change the trim or molding to make them more modern and even wonder if wood shelves would look good to match my dream beams. Ripping out the built-ins and replacing will be costly unless I find some cool furniture pieces to go there. I will also hold off on the painting the fireplace so I can see what the brick looks with an all white room. My painters love me and they come back every two weeks for my next Phase of renovation. : )