I would close the pass through, pre-wiring it for TV. Beef up the mantel, adding larger art above it (can be as wide as the firebox opening) and arrange seating around the double focal point. Pix of all walls would help us advise more tweaks. If that is a TV on the left side, that might be the spot for more substantial casegoods like a bookcase or secretary. Better help would come from seeing your actual furniture in the space.

A built-in can "stick out", making the fireplace recessed. Just get rid of the wall decor and add a rug, and rethink the lighting.

Yes that’s the current owners tv on the left. There’s a huge sky light over the fireplace, so my husband was leaning toward keeping the tv in that spot. Not sure if built ins would work there because it’s a walkway to the back of the house (see picture). But I’m going to look into the idea of putting the Tv on the right of the fireplace…if it’s big enough for my husbands TV😵‍💫

We’re moving in so not opposed to buying whichever furniture works best in the space.

A 3-seat sofa and a pair of comfy upholstered armchairs are great base pieces and allow for more flexibility. The chairs can swivel if need be. An area rug that is at least 2 feet wider than the sofa can anchor the seating area. The current TV placement puts it in a traffic path, so I think right of the fireplace will be perfect.