This looks like something that might work.

You have all the reasons to redo the house, its very lifeless and looks worn out. I feel creating a separation will terminate the spaciousness of the room. Adding colours will surely help, Since you have a tan color sofa,I suggest grey, white or light blue color on one of the walls. Add some art works of the color you chose for the wall. This room needs some fillers like , books, throws, candle stands tall and lean. YES DON FORGET 1. Mount the tv on the wall make some space on the floor and Fix a large size mirror ( Wooden Frame if you can afford).

I would put the TV on the wall you have the sofa on now and use the larger wall for your sofa. Right now it looks jammed into the corner. It should be fairly easy for the "cable guy" to move your cable outlet to theother wall if you don't have one there already. Or an entertainment unit would be better for your TV set-up on that wall.

I feel partitions are not needed. You already have too much for the space. Adding a partition will shrink the space further. The simplistic solution, you do not wish to discard any furniture would be to paint all the walls in lighter pastles. And use some wall painting frames to highlight certain walls.