I would fill in the hole........

I'm not qualified to advise you on textured paint, but as far as colour is concerned, surprisingly, red can work with a very wide range of colours. I suggest you click http://www.houzz.com/photos/query/red-sofas/nqrwns and browse to look for possibilities. A lot depends on what else you want to have in the room and whether, for instance, you're looking for a dramatic effect or a warm effect. Have fun browsing.

Post a picture and Houzzers will do it for you ;) We need to know where doors, windows,fireplaces, etc. are. Also post what your needs are. How many people need sit at the table? Do you need a TV in this area? Do you already have any furniture you hope to incorporate? We can never have too much information.

'Supreme" chairs come in dazzling colors.I flipped for them when in Kerala but bought them while at Vijayawada. They are available anywhere and are water resistant, strong and too cute to look at. I am yet to find a table to pair them with but will do so soon. red,lime green,black,white,brown,blue,yellow...my god.The colors and their vibrancy is awesome.Many more colors as listed are available.