Cool space. You could make it look like a movie thearter. Set a popcorn maker on the bar and put lots of snacks in plain view. It would also serve as a good spot to hide AV equipment ( but that might take poking holes and running wires). But making the room look like a movie thearter should be that difficult. Some dark paint and light blocking window treatment is a good place to start.

The bar counter you just do not need. Showcase cabinet, you can leave.

Is the tile flooring continuous under the bar cabinet or would you have to redo the flooring if you removed it? If lots of cost, embrace the bar and go with the movie theater idea, which is good idea. I definately would like the sofa moved from in front of the fireplace to centered between the the windows. The chair could then be cozied up to the fireplace.

I agree with bulldawgy about moving the sofa so its back isn't turned to the fireplace. If placing it between the windows becomes a problem for TV viewing, try and angle it outwards from the right of the fireplace (parallel to short diagonal edge of the bar counter). Either place the chair between the windows or in the corner to the left of the fireplace.

If ripping the bar out is an expensive proposition, I'd use the hutches to display books or collectibles, and use the bar counter as a kind of "work surface" - laptops, files, etc - with barstools placed between the hutch and bar counter instead of facing the hutch.