You can put the TV over the fireplace, not the best situation but the way the room lays out it is the only logical place to put it. If you could you should add one additional layer on your mantel that could extend it out another 4" to deflect the radiant coming from the fireplace. I would also mount it on a slimline mounting bracket and have the bottom of the TV no further than 4" above the mantle. Ideally you want the TV to be in as straight a line as possible with your eyes. You don't want to look up too high at the TV, it's like being at a sports bar. Also if you can snake up the power and the HDMI from the cable there is a box they make that has both in one so it makes for a very clean installation.

Get the professional sander guys in to repair the living areas and kitchen but don't go too dark with the stain as it will kill the lovely grain in the matai. I'm thinking a couple of tones richer than the timber knots showing in your photo, definitely no yellow tone at all. In NZ stepping on to carpet especially in a kiwi winter is so much nicer than a cold floor board shock!!! A nice area rug for the lounge and you're done.

I would continue with frosted glass like the door on all the windows because the view of the other house. Not sure where you live, but you can get a frosted window film that you install yourself. In bedrooms and lounge, depending on your style, you might like a woven roman shade with silk drapes.

I'd love help picking a couch and rug color for our living room! As much as we would love white, it's a high traffic area with kids so we're leaning toward gray but I'm not sure what color rug would go with that... Also light gray or dark gray? Any help would be appreciated!