I believe the reason the tiles work well with the cabinetry is because the tile is lite in color and flat, its not rustic unlike most terracotta. The expensive cabinets work fine with the floors because of the smooth finish. The floor here is the focal point of this room. The Interior Designer or whoever did this room, did a very nice job, keeping it very simple.

We are a little biased, but wood floors are versatile, durable, clean, and timeless. Whereas carpet will eventually need to be replaced, high quality wood floors can last forever. You can install radiant heat under the wood floors if you are worried about them being too cold during certain times of year, and you can easily install area rugs over the flooring. Wood flooring is also more versatile than it has ever been so you can create any look. As an added bonus you can easily sweep and mop your wood floors, whereas with Carpet you don't always know what is lying below the surface. Good luck!

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.

We had the same issue in an old kitchen, we went with Coopers, There is a stripper then wax that will soak in. The stripper is in spray bottles, but I'd send the dogs on holiday or keep them outside while you're doing it. It'll take some elbow wax, but will look amazing when you're finished. Good luck!