I don’t think a curved sofa would be appropriate. Curved sofas seem too elegant and traditional for a family room.

You can do a sectional. Or a sofa and an accent chair or recliner.

What’s with the carpet? Can it be replaced? Is there something underneath it?

Otherwise you need a large rug.

Can we replace the fan for a regular light fixture?

I’d also consider putting a bench under each window on the right wall.