I think you could easily do that, as the house has the basic shape and rooflines to pull it off. It would probably be a pretty simple thing for an architect to design you a new elevation with the appropriate sidings, column shapes, etc. I say do it!

I think if you incorporate some features like the stone and cedar that's in the above photo, it would look great in your wooded setting.

You could make small changes inside.replace lights as you find craftsman style that appeals to you. Collect pottery of the period.
Architect will be able to tell you what will be involved. And maybe a cost estimate...architect, general contractor and interior designer will sit down with you to plan.
Off subject but why did you buy a ranch when you wanted probably to buy a craftsman in town?

Thank you for the feedback. We purchased it in 2006 with the intention of remodeling and selling after a couple of years. This was our 4th move/flip in 12 years but unfortunately our timing wasn't good with this one. Although the market has improved, I have lost that loving feeling for the moving process and want to see what my options are with converting the style into something that I will love!

Thanks for answering my question. I hope it all works out.
I, too, would have liked a bungalow but they were too pricey in our new retirement town and too many stairs for our future.