How about a wide fireplace the same width as that big upper window reaching all the way to it? Would be quite stunning in the right materials.

If you remove the mantle and refinish the fireplace surround, you will have just enough space above the new mantle to mount the TV. Keep the lower built in cabinets and possibly change color or texture to blend in with stone surround. I would also recommend an RF remote to control the equipment if you're not using one currently. This will allow you to keep the doors closed and control the entire system.

I agree with Lina and want you to take it a step further, also paint the interior of the built-ins white. Is the TV part of your purchase, if not getting something a little smaller will help frame it by the cabinetry though painting it all white should help. As it is now there is too much going on with changing contrasts which probably has more to do with your dislike of the built-in than the actual unit. I would not put anything on top of the mantel. Ever.

Please do not even consider a sectional. They are a pain. They are bulky looking and personally, I hate sitting right next to other people like ducks in a row. A sofa and 2 chairs will add so much more interest to the room, guests like their own space and room arrangements are more versatile. I'm sure you know that keeping your wall décor at eye level is important. Not sure what sellers where thinking with the tall vases and wall mounts :>)

I love sectionals and after many years without we recently purchased one for our own home. They don't have to be bulky looking, mine isn't, there are many styles to choose from. If you decide to explore getting a sectional then also look at sofa tables or a large church bench to put behind the section that will face the kitchen area.