I suggest you find an interior designer in your area to help you with your remodel. There's a lot to consider when you are removing walls and redesigning a kitchen.

Of course you'll also need a licensed contractor. Together the designer and the contractor can guide you through the process. An architect could also be needed, depending on the scope of your project.
Carolyn Albert-Kincl, ASID

Sounds like you are talking about a project of some complexity, where the guidance of a trained and experience professional could be beneficial to your outcome and your pocketbook. You might try using the Pro Finder to locate architects or interior designers in your area whose work you like.

I like the idea of hardwood throughout. You might want to relocate the sink to the opening/cutout in the wall. That counterspace would be nice for dishes and prep. Plus the view would be better than the corner.

From there, replace the cabinetry. The attached picture could work really well as a template for inspiration.

You can learn more about our services here- http://www.granitetransformations.com/southjersey/services/kitchen-remodeling/

Hope this helps!

Your house was built in the pre-island era; consider opening up the wall between kitchen and dining room (you may need a column/header for ceiling support. This will allow you to make the kitchen open to the rest of the space, with an island with seating where the cabinet run is.
Consult a competent carpenter to assess the load bearing issue.
See my profile for examples.

You may consider knocking out the wall where the dishwasher is currently located, and building a 40 1/2" knee wall there. The knee wall would then serve two purposes. You can have a 42" bar top extend into the room behind the dishwasher wall and utilize this as an area people can sit at and eat. Move the dishwasher over to the right of the sink and the area under the space where the dishwasher currently is located can have a base cabinet accessorized to your needs. The corner sink is a waste of space as well. If you could center the sink under the existing pass thru, and move the fridge to another location that may be helpful as well. If you were to come into my showroom needing help, I would try to present the ideas I mentioned into 2 separate designs minimum. I see a lot of potential that is now wasted space due to the poor design. Good luck, and remember that it is a huge investment you will be making. Do not order until you are satisfied that the design will meet your needs.