I think the first layout is fine. You might want to consider moving the door for the storage room of the master bedroom so that it opens into the hall. That way the kids can use it for overflow storage. Also, that hallway is big enough that I think it could hold a large armour, providing more closet space. (There's no need to sleep in the same room as your clothes, so long as they're not too far off.) Also, don't forget that while the drawing shows kids in double beds, this need not be the case, so there will be more room for furniture (dressers or whatever) in their rooms. Finally, that step to bedroom 4 will not be odd at all. I've seen it in other homes. It looks clumsy in the drawing but it isn't. What you'll see when you come up the stairs is a bedroom door on a slight diagonal. It's only an odd jagged step if you walk like a robot, in straight lines along the wall, which is what your eye is doing on the drawing but you won't do in real life.

I would move the two chairs against the wall with the table between for a "side" seating area... which can still see the t.v. (needs some baskets or something under that table... a trunk maybe...to bulk it up). Then make an L shape with the other couch/loveseat that you have. You also have great storage along the tv wall but it's kind of bland... punch it up with a color along the back of the bookcases or a funky wallpaper. Drapes for a punch of color with some other accessories and you'll have a gorgeous room. It also looks like you have an ottoman.... put a tray on top and use it as a coffe table for a while.

Depending on your goal....beauty?it could be a lovely art piece(tall and slim) ...or function? A corner cabinet for shoes , bags ,coats?...these days home represent a place to relax and rest so I am of the school that the first thing you see as you enter should set the tone of your home,makes you smile ,or feel good

You say the kids come in the small door and then bring their stuff to the large door to drop it? I think the "mudroom" needs to be at the small door. Anyone who brings their stuff out of that area has to clean the glass doors next time they need it. As for the guest entry, you need to get something bigger than that desk, and your picture needs to be lowered so the center point of it is 5' above the floor (you'll have to calculate the centimeters.) Consider making the investment to reverse the swing of the door so you can make the best of the larger wall to greet your guests with a console or credenza and some decor.