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corner fireplace in living room

I would like to arrange the furniture in such a way that is cozy and comfortable yet doesn't block traffic flow (we have two boys and a dog) or the openness of this area of the house. The photos how how I have it arranged now. One is taken from the breakfast nook/kitchen entry to living room and the second is from the other side close to the entry of the home. Thanks!!
Emily

PS..the dog kennel doesn't HAVE to stay where it is...LOL we just moved in so we haven't found a spot for it to be just yet. It was easy to have it right by the back door while the pup figured out our new digs.

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