This room has some great things going for it--a fireplace, wood floors, cool trim, but I just can't seem to pull it together. I put several pictures up on our blog and would love advice. http://scravings.blogspot.com/
I grew up in a musical family and with two fireplaces, a piano and a rather large electronic theater organ. An aged friend of ours played for the San Francisco World's Fair and once supported herself playing organs for silent movie theaters up and down the California coast. She was our church organist and pissed me off for tuning the electronic thing there to sound like a theater organ. Hard to get into Hell and Damnation with a theater organ. Bach with frilly twists is just not the same. I think of her every time I go to Wrigley Field and here the old organ.
I remember furniture being arranged not at all along the walls like you have. It was nested with the piano or organ as a focal point or could be moved to sit by the fire. There was a large sofa and a smaller loveseat thing in each room near either the piano or organ. Most decor was about comfy chairs. We didn't have dancers in the family but you could have easily moved chairs out of the way if someone wanted to pursue such things.
Have you ever done a scaled floorplan and moved furniture and piano templates around. It can provide a different way of thinking. Sweet Home 3D is a great floorplan program. It is open source, supported with lots of contributed templates, and it is FREE.