Need Help with Layout

Please excuse the long post, as I feel our room needs some explanation.

As you can see in the pictures attached we are in need of new living room furniture. This is our only sitting room with furniture so all the furniture gets used. We are a family of four with a big dog who loves the couch as much as we do. We have had our current furniture setup since 2013 so it is hard for us to imagine rearranging the room any other way, but as we look at the setup we are starting to feel like we aren't utilizing the space correctly to capture the openness, the window or the built in bookshelves. From what we have figured we have two options:

1. Leave the layout relatively the same and replace with a new couch/loveseat combination or a sectional that fits. I like the idea of a sectional but the issues of increased price for one corner piece and the fit being specific to this house do concern me. We are also concerned about the window and sun on the piece (as we plan on going leather) and based off our measurements a sectional would cover the bottom shelf of our built in bookshelf.

2. Totally rearrange the room (so stick with me as I try to explain). The wall the TV is on in the pictures is our longest uninterrupted wall. We could move the TV to the corner wall, where the lone stand up light is currently. Mount it to the wall on a swivel mount so the TV can be pulled out and angled toward a couch and put a TV stand/piece of furniture to house the components along the wall below the mounted TV. Then we could get a long couch on the backwall (165" total length so we were thinking a four cushion H&M Your Way couch with an ottoman or coffee table) and either a chair and ottoman or reclining chair in the corner opposite of the TV (in front of one of the bookcases) or in front of the window.

We are trying to keep at least five spots to sit and we don't consider the corner of a sectional a spot. Our research is pointing us to either a H&M Your Way piece or B&Y 200/900 motion piece. I understand the difference in quality and warranty between the two but those are the two that we keep coming back to. My top choice is the H&M Your Way in one of their unprotected brown leathers but it really depends on the set up we come up with. I don't want to put an unprotected leather piece in front of that window because of sun fade so if we stay with the same setup we have to decide what we will do.

I appreciate everyone's help as we are finding it super hard to envision a new setup because we are so used to our current setup.

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You can pull off a sectional in your room, but it requires a change in design mindset from what you have now. Your room is a hodge-podge of design elements, are you prepared to clean it all out? The layout is good, I'd keep that. But the heavy looking pieces all need to go including the oversize clock and the signboard to the right of the TV on the wall, as will the side tables, baskets, etc. You have a smaller space to work with and the trick is to make it look larger. So with that in mind, let's clean-slate the room and keep everything in the same spot. All the heavy and mis-matched pieces should go. If that's too hard on the budget, then do it slowly, just stick with the plan.

First, the sectional needs airspace under the base. This will "lighten" the look of the room and bring it more mainstream. Less is more. I would use a sectional such as this (most these have different frame pieces so you can configure to your liking). This may take some getting used to, and no dark leathers. Some examples

http://www.hancockandmoore.com/Produ...ater-Sectional

https://www.taylorking.com/furniture...ory=sectionals

https://www.bradington-young.com/sec...formation.aspx

The carpet goes as does all the dark wood furniture. The TV Console, painted perhaps? Hard to tell as I can't see the color. Chair in the corner where the doggie bed now is.

That would be my starting point. Good luck.