It appears your sofa would block a heat/ac unit in the first pic so the second option is the only real option.

I much prefer the first arrangement, but as suebell notes, it does block a wall unit of some sort. What's on the wall opposite the dining/sofa area?

It looks a bit tight having the second end table and lamp at left beside the door. But the sectional along the window wall and large back wall does look best.

I agree with Barbara to try flipping the two spaces, as it will feel less cramped when you enter. Put the mirror above the couch and opposite the window to reflect light and the outdoors. Create a gallery wall on the large.

The TV is on a wall over by the door directly across from the sectional. It sits on stop of an electric fireplace. The AC unit is blocked but is not needed during the fall and winter months.

These are the two walls you can’t see

Other views with various lights

I like the second picture because it creates a kind of a "room" for the dining area. For the lighting, the best is a table lamp of wall sconce in each corner at chest height.

The furniture arrangement in the first picture is better. The space is small and the sectional can only be placed in the corner to keep the room "open". Add some art and some color. Use fewer pillows (or none) on the sectional. Accent pillows do not stay in place on leather furniture, so they always look messy.

Maybe soft curtains will add some texture. Hang art at eye level to an average adult.

The first arrangement is better but remove that end table that’s blocking the door (use a floor lamp if you need the lighting, as appears to be the case). If the wall a/c unit needs room, you can move the sofa forward 6” or more and you’ll still be better for it. Flipping the spaces as some suggest will leave you feeling like you’re watching tv in the hall, so I wouldn’t.

I'd set the room up for permanency(all seasons), thus the second arrangement would work best. Just keep some throws available for the summer since whomever sits across from the AC will need them.

Sectionals mean no-one can sit in the corner without playing legsie with someone else. Separate it into two units. That might allow you to add a chair as well. Don’t forget lamps.