Hi there,
The space becomes challenging when dealing with small spaces, and finding a suitable area for the piano. I would suggest to swap your areas, and place the piano in a designated "dining room" area. In this case, you have enough room for 2 lounge chairs in front of the fireplace and the tv above it, including a large dining table, that can accommodate 8 people. Overall, the space will not appear cramped, and allow comfortable clearance for circulation. Also, keep in mind that the furniture shouldn't have sharp corners. Your lounge chairs should have curved edges, the coffee/side table circular, etc.
Please find attached layout TO SCALE of your space below. Let me know what you think :)

Sell the table on E bay and get one with two leafs. The table is too large for this space on an every day bases. Have the leafs for when you need it only.

The above does seem like the only way you can fit it all it (albeit with 2 less chairs, impractical space for such a piano and sitting way close to a really big TV)... but I am still left confused about the layout. Is the entrance way the only way into the space? Are there other entrances to the dining room or does it have 3 solid walls? Is there only one window and door for the whole space? How high are the ceilings?

Is this the only fireplace in the house? Will you actually use it and then clean up the ash mess off your nearby piano?

Do you use the dining table? Is it a museum piece that needs to be decorated but not used? How often would you have a full table? Or are 4 guests more common? Have you thought of only placing 6 chairs around the table and then moving the other chairs elsewhere either in the room or elsewhere until you need them? You could have the dining table in the dining room space and have 3 chairs on each side rather than having a 'head' of the table. In your plan, you could run it vertically.

How often is the piano used? Does the piano get played while someone is trying to watch TV? Is the piano special or can it be downsized too? If the piano is a museum piece then put it in the corner so you can look at it. But if you play your piano daily then putting it in a corner will make it a museum piece.

It is OK to downsize the TV. The TV needs to be proportional to the room not to the size of a man's ego. Besides, this is a perfect time to upgrade your TV and perhaps get one of those new smart, higher resolution TVs. A smaller TV could fit in a neat corner cabinet between the fireplace and window.

So many questions...

On a side note, I would get big lush curtains to absorb some of the music.

So many answers to so many questions. But, first, thanks to all for the advice. The space first - There is a door from the kitchen to the dining room located on the back wall and a window on the left wall of the dining room. Normal ceiling height for the dining area but vaulted ceilings in the living room. Piano and TV never played at the same time but both used frequently, piano (no downsizing here) days, TV at night. The TV is new, smart and high resolution. The fireplace will seldom be used in Southern California and if it is there will be gas logs instead of wood burning. The dining table is much too heavy to ship on EBay though I am considering consignment. It is not an antique but custom made for us and quite special in design. I like the idea of 6 chairs for the dining table, that would solve the size problem and accommodate most meals. If this is the configuration that might work the best would then the final question be piano placement. Would that be the right front corner of the living room?

The trickiest part of the plan is what to do with the really really big TV rather than the piano.

I loath walking into a house and the first thing you see is a TV. Wouldn't it be awful for the first thing people to see is a gorgeous piano competing with a oversized TV? So, my suggestion is to put the TV on the entry side wall. Then, guests will have to turn around to see it. Your decor will dictate how it is put there (hung, sitting on a cupboard, sitting inside a cupboard, etc). You need to be sitting far enough away from it since it is so bit. I think that you are just going to have to fiddle around with chair placement depending on how you feel about how far you are away from the TV.

Piano in front of the unused fireplace on an angle with the pianist looking toward the dining table.

I have attached a crude copy paste on the lovely design above, but I think I have lost all scale. Of course, now you have to think about lighting...