Can you make a sketch of that, whole space?

Account for the feet and inches ONLY by showing all the walls, windows, openings . All have their own dimension.. From this view...feet inches all.

Include the island edge, the stair .....breakfast area

Agreed--sectionals are never a great idea in a small space. Even better than a sofa and chairs would be 4 chairs around a round coffee table or ottoman. I've done that 3 times for clients and they love it.

I'd do a sofa and chairs. Given that you seem to need more storage space, I'd get some tall shelving.

One possible arrangement:

This envisions an entertainment center with a back (something like below), holding a TV and serving as a room divider, with the sideboard placed against its back on the dining side. I've used a 7'x3' sofa and a 3'x3' chair, plus the existing black leather chair. Four ottomans pushed together serve as a coffee table (with a tray), or kids' play surface, or extra seating for a crowd, as well as a way to put your feet up. The rug shown is an 8x10. I've also used all the other furniture pieces I see in the photos except the light wood ladder shelf, which could perhaps go in the dining area corner instead of a plant if needed--or it could hold plants. (The piece currently in that corner I moved near the door.) The two black shelf units in the corner near the bathroom hold kids' toys. (The three-light floor lamp would probably be better behind the black chair than where shown. It would provide reading light for the chair, wouldn't block access to the entertainment center's storage, and I think would be out of the traffic lane enough that people wouldn't bump into it.)

A few deas, anyway. Here's the concept of the entertainment center: