Cupboards look like they are in nice shape. What don't you like? I do feel the hardware is in an odd place, right in the center. You can paint them, a lot of work but new paints are out that give a nice finish with no stripping involved. But again, decide on some accessories or focal points before painting anything. Then you can pull in the colors you want from those.

I like the cupboards very much, but the countertops less so, and would place money there. If you are a DIYer, I offer this treatment ( ignore the backsplash) for the insets:
[houzz=]

I think the ceiling molding might be removed, and the baseboard and window trim beefed up, or painted out, altogether. The beams are quite widely placed.? You might consider painting them in a gloss white against the matte ceiling - it would still highlight them, but make the ceiling appear more lifted. Trading the turned rails for iron work would still reference the style of the home, but add interest. Budget allowing,hardwood floors could improve on the wall to wall carpet.
I've located a few shots of rafters for you to peruse: http://www.houzz.com/ceilling-beams/p/24

Those cabinet doors could look pretty cool painted black with a modern pull at the corner. Look at other kitchen photos for proper placement. The center pulls are awkward to use, and look outdated.
Also, I'd paint out the narrow trim and have it match the walls, and paint the ceiling beams white. For wall colors, your best bet is to find a fabric you'd like for drapes or throw pillows, and pick your wall color from that fabric.

I like to pull color inspiration from artwork, fabrics, decorative pieces and so forth it helps me stay on track with my color palette and décor. Do you have anything that you would like to put in the room that could help with your direction? Because you could play off of that while also being mindful of the surrounding rooms and their color palettes. You mentioned you wanted to a brown leather couch, I find fresh white and bright colors pair well with rich chocolate browns. I really like the Long Island sectional from Bryght, modern and sophisticated and I think would look great with the existing wood in your living room, For extra comfort you could pair it with the Polo ottoman in brown leather.... just a thought.

http://www.bryght.com/product/854/long-island-brown-leather-left-sectional

http://www.bryght.com/product/820/polo-brown-leather-ottoman

The back wall seem a bit empty. Maybe some kind of feature wall mural will help lift up the atmosphere in the space. Check out this art supplier I found last week. http://www.atchconcepts.com/projects.html

I would freshen up with new, creamy white type paint...and stain the wood trim darker for ore contrast (in both rooms)...Kona is a great stain color...can't remember brand, but it's at Home Depot. I would also create a feature wall, and do a stacked stone all the way up the fireplace to the ceiling and replace the mantle...see pics. This would add texture and give you a warm, cozy feel. Built-ins on either side of the fireplace would be a great functional and aesthetic addition as well. I would also replace the carpet, with a wood plank, or tile that looks like wood. Popcorn ceiling needs to go too!! replace the fan with either a better looking fan, or an interesting light fixture. For the kitchen, I do actually like the cabinets and would leave them the same color...even with the wall trim stained darker, but the cabinets blend too much with the counter. I would look into replacing the countertops with something lighter, that will contrast with the wood. Adding a more interesting backsplash will also make a huge difference....and updating the hardware on the cabinets is simple, and quick update! The floor is fine in the kitchen, but it would look best to have the same flooring in the living room/kitchen for a better flow. Again, popcorn ceiling is really outdated and kitchen could use some better lighting. I would add a few thoughtfully placed 4" recessed cans (CREE 4" LED are awesome, and affordable!) and layer some under cabinet lighting as well. If it's possible to relocate the vent in the kitchen ceiling, I would look into that too...it's a bit of an eyesore. Last, I would paint the doors same color as the walls...leaving the dark trim. Good luck!!!

update the ceiling fan to a more modern clean look.

Remove the columns and half walls to expand the entries into the other spaces.

Hardwood floors in the living room extending into the kitchen would update the flooring and make the space seem larger.

For an immediate update, replace the fan and ceiling fixtures with new, current styles and replace the posts used at the pony way to separate the living and kitchen. They look to be purely decorative and non-supporting, in which case you might just leave the opening as is, or open it on out, eliminating the little pieces of wall. I'd leave the cab's as they are for now. You may discover what doesn't work as you live with them, and then you can decide what to do. The fireplace is your focal point, so I'd invest my $$ there with either a refacing job or a real mantel, or both.