I live in a 70s bilevel, so when you come in the door, you have to go either upstairs or downstairs. The entry is tiny, with a drop ceiling, and then when you go up or down stairs, the ceiling is higher. My little entry really needs some design help.

First off, lighting. There's a little light fixture on the drop ceiling in the entry. I thought maybe we could get rid of the drop ceiling and make it part of the upstairs ceiling, but I looked up there, and it doesn't really look like a possibility. There's also a hanging chain light above the downward stairs. Tips on updating this lighting?

Looking down at the entry, I see the front door, the hanging chain light, and paneling.

Looking upstairs, here's the little light fixture in the drop ceiling with the hanging light in the background.

Next, paint. I hate the paneling and plan to paint it once I figure out the lighting. I already have that mostly figured out, but any tips are welcome.

Flooring. Right now, it's cheap linoleum. What do you recommend for something that won't get damaged by wet, dirty, snowy feet coming in the door from the garage?

Here are some more pics:

Looking down to the entry at the floor, front door, door to garage.

Coming in the garage door, glancing downstairs (ha, the 8 sticker is thanks to my kids)