Thanks everyone! Yes, we are definitely painting (probably should have told you that). I love the ideas of adding mirrors and lighting too. I've been out today looking at bedding and paint colors. Since I can't replace the carpet right now, I love the idea of adding a patterned area rug so I think that will definitely be an option. I will update this once we've gotten a plan in place. Thanks so much for all of the advice!

Don't be afraid to paint some of the oak pieces, but consider some chalk (not chalkboard) paint and some gray, rather than all white. Move your bookcase into the 3.5' niche, and place it flat against the short wall. Angle the floral chair and footstool over there and create a reading nook, adding the floor lamp. Hang a large piece of art on the big wall, center point 5' above the floor. Eliminate the glass oak cabinet and the little metal table. If you wish to keep the wall sculpture, hang it above the stairwell. The stairwell is where I'd make the biggest change, but it will cost. I'd replace the railings with a pony wall pre-wired to hold the TV - hung on the wall or recessed inside it. Place sofa table and your sofa on the wall we just cleared. The return air vent won't be covered, Use the lamps on the table and a piece of art (no wider than 75% of the table's width) hung 5" above the sofa table. Angle the matching chairs perpendicular to the sofa with their backs to the wall where your bookcase was before. Your round pedestal table will go with them. Where the bookcase was, place the armoire, but use it for storage. Paint both rooms a pale gray that you love. Sorry for the rough floor plan.

I suggest getting a new landscape plan from a pro that you can implement in stages. Some of the larger shrubs under the windows may be transplanted in a new plan. If that's not what you have in mind, try trimming the shrubs back to a foot below the window sills. This is a good time to plan bulbs in many areas of the US. Paint the front door in a new contrasting color such as deep red. If you like brights, try lime green, orange, or yellow.

I agree with Pyramid. A sledgehammer and a new "frame" and prep for your new hearth will probably be best.