Your picture display looks lovely with your sofa and will look better if you bring it down because it's a bit too high above the sofa ( unless you plan to keep adding to the picture collection below from where your pictures are hung now) and in that case just keep in mind that multiple frames look best when arranged in a diamond, rectangular or square shape and spaced relatively tight, like 1-2 inches apart. A looser grouping can work for a more casual display.

What a fun space! Love the pillows...I agree with above, lower all the frames, but not so low little ones can reach. The art should fall at eye level about 5'4" for walls and for behind the sofa not more than 12" above it. Then keep the width about 5" inside the sofa length on each side. Your frames are small so you need the close together for impact. I would start with some pretty curtains for the door and large window and then a simple Roman shade for the small window- since your girls play there you don't want anything they will grab hold of. http://www.houzz.com/ideabooks/query/how-to-hang-a-photo-gallery

A few simple steps can give your room a lot more vibe! Try pairing the drapes with sheer curtains, that will give the window more depth. The tv wall could be your accent wall, a dark blue would actually work very well. If the TV has backing, I would hang it on the wall, a few inches above the furniture piece. The two frames above the white dresser should go below the wall clock. Instead, a large art piece (about the length of the dresser) would complement that wall much better. I would also replace the coffee table with a rectangular, heavier glass and metal table, placed in the center. Also pillows. Pick up colors from your art work and the accent wall and use those to find pillows to decorate your sofas. Hope this inspires :-)

I like your plan but I don't think a pattern on the bed wall is a good idea. The carpet already has a lot of pattern so I'd keep that wall a solid, dark color, from the rug. Add some sparkle like mercury lamps for the bedside tables for interest.