Well the piece above the fireplace really overwhelms the space, and most specifically the fireplace. Is there another wall space anywhere that can showcase it? trying to use this piece in such a small area makes everything else lose its appeal, it has to fight to be seen. For sure move the sofa where it faces the fireplace, or set at an angle facing where you hv the TV set to be mounted. If you can, leave the chair in the same area, use the table the TV is sitting on as a coffee table for both. The way that makes the space work is the way you need it.

The blue is awesome (grey is too trendy)! The reason it stands out to you is perhaps because it's the only real colour there. Bring in the blue in a window treatment, a small appliance that sits on the counter, a pretty tray or area rug. Also, it is more appealing often if there are more than 2 colours - so right now you have a white and blue colour scheme - bring in red or orange or fushia - something from the other side of the spectrum (like you did with the yellow flowers but in a more permanent way)!

I read an interesting comment somewhere, where a lady invited a group of her friends over to lovingly point out all the problems they saw (through fresh eyes) with her home on preparation for sale. She said she was surprised at marks and damage that she had lived with for so long she no longer noticed them. We "owner built" a home previously, and when we came to sell 7 years later, we painted the garage and did those jobs that we had put off, and it became sad to finally see her at her best, at the end, when we could have been living in a completely finished home all that time. I read about a lady who decluttered her home, had it professionally cleaned (build clean, or bond clean) and had a professional styler do her home and she realised just how nice it could be and decided not to sell. :) ta

I'd take a totally different route . It looks like there is that narrowish window in the lounge or dining area -- I'd look at whether you could make that into a ranch-slider ( yes , I am in NZ too -- if you say ranch-slider it confuses the Aussies haha ) . You'd need a structural engineer to make sure that wall isn't load bearing , and also electrical cables are able to be moved , but I'd suspect the load bearing bits would be the corners , and you'd be able to 'open up' that wall onto the deck . While it initially may seem counter-intuitive , you could then take out the door and that other taller window -- close it in and add a couple of small windows , or how about doubling down , and seeing if you can 'open up' between what you call the 2 windows above the stove -- have 1 long flat window along there , OR even do another bay window -- that will add more light , but also by taking out the opening door , you will get an extra metre of space , That way , you can do a different kitchen design -- maybe a wall mount oven , or a pantry , a breakfast bar in a different spot -- basically , plan the kitchen and the window placement at the same time . The advantages would be more usable space , more light , an indoor/outdoor flow but through the other room , not the kitchen . But with more glass actually in the kitchen , it will feel lighter and airier , plumbing won't be as much of a hassle , it will look better . The only possible downside would be the wall you put the ranchslider in will need to be kept clear , as you may lose a bit of space there , but the breeze and openness will make up for that IMO .