I would go with the sofas spread out....its way more conducive to watch TV. There is a way to make it cozier than you have it. You need a way bigger rug and coffee table so you can connect all the seating together. You can also use some pillows with a bit of color to warm up the leather couches. And additional colorful accessories on your side table. Everything seems to detached from each other.

I thought about pulling the sofas away from the wall but if you look at the picture you've got the staircase and walking area.

Move tv to wall on the left side of fireplace (tv will then face kitchen). TV should be eye level, long cradenza under tv, even if you mount tv to wall. Pull sofa off of staircase wall up to edge of rug (probably need a larger rug). Other couch pulled closer to rug, facing tv. Place chair on left corner of fireplace at an angle facing couches. This arrangement would be cozy and more comfortable for tv viewing and conversation.

Benjamin, you appear to have very gracious size spaces and that all of this seating group could tuck in together nicely with the ability to pass behind one of the couches. Since you seem to like the TV up high, that's your best option. If you move the TV off that wall, other options open up. Good luck. Pretty rooms.

I think Option 2 looks a lot more balanced but I agree with Anne, that you need a much larger rug. Would there be enough space to walk behind the sofa if you chose option 1 and pulled the sofas away from the walls?

@fpmac, really good suggestion about moving TV from above fireplace.

Whichever option you choose, you need to move the furniture closer together. You have so much space between the sofas, chairs and coffee table that the table is unusable. There should be about 18 inches between the table and sofas, more between the chairs and table if there's a side table next to the chairs. If you look at many Houzz photos you'll see large spaces between the coffee table and other furniture, but that is to emphasize the size of the room. You don't want to be getting up from the sofa just to take a sip of your drink.