I agree with lefty. Really think you should cut back the area. Even if you don't pave in the degraded area just plant it will look larger. Two levels shrink the space one level feels more like a room. Also I can tell the fence is your neighbors because the rails are facing your side. I would face the fence so that it looks better in your side.

You DO have a steep slope to deal with! The tree roots will help stabilize the soil and make a mudslide less likely. If you cannot mow the lawn safely, terrace the area (think Machu Pichu) into garden beds for flowers or vegetables. Do you want your children to play on a grassy area or on a man-made surface? Be sure that the play area has shade during the hottest part of the day. Best wishes.

windows in master bedroom need to allow views and privacy and much as i would prefer bed on NE this keeps the bed in view towards and from family room so prefer bed on south wests wall and small sliding doors pushed towards north side of room with tall narrow window beside sliding door and highlight window for light with privacy and wall space for chest of drawers...acknowledging theta the pwdr doesn't have a window but my suggested arrangement uses less total space more efficiently and is better for older kids and long stay visiting parents (more people can use the various options at the same time) and a small ventilating skylight will exhaust and brighten the toilet and vanity area ...the wide door into the lounge can be a stacker or stable door so you need to investigate local options (and everything is expensive unless it does what you want...we always use solid core doors that can be ten times the price of a basic hollow core door but love them so we economise elsewhere) and barn door between entry and family would be OK as long as you like them and it doesn't compromise lounge doors but could look ok if both doors are the same style and different widths...and location of dishwasher is personal and if you have already been unhappy with sink in main kitchen then have it in the scullery...main advantage of my suggested kitchen location is that it's closer to the front and the family area and external doors and the pantry uses the central space that can be much better illuminated with another ventilating skylight instead of a tiny external window and noisy exhaust fan

These stairs go down to my daughters house. They are both narrow and steep with quite a drop on one side. Does anyone have any suggestions on how they could be improved?