The Living Room in this small open kitchen dining living room design looks inspiring without being added with other living room colours. Description from limbago.com. I searched for this on bing.com/images
This seems like the most reasonable furniture arrangement for the space. Of course, the loveseat would have to be at the east side of the room so it would open up to the kitchen and not the formal front room. I'm not sold on the particular furniture, but at least I have an idea now.