foil insulation works by have a low-emittance surface i.e. heat hits one side but is not emitted through the other. For this to work the foil needs an air space on the non-emitting side, if it is hard-up against something then it will conduct heat through that material, 20mm is enough. Bulk insulation (think fluffy batts) works by slowing down the flow of heat by making it move through a huge number of very small air pockets to reach the other side. In short, a well designed building will always have a combination of both foil and bulk insulation. Your climate will dictate the build up of the wall as you do not want to create a condensation problem within the wall itself. As chookchook2 asked, where are you?

I once lived in Ballarat in a house with hydro heating that was too expensive to turn on. I slept in flannels, under two doonas, on an electric blanket and cursed each and every morning of winter! These days in Perth where the winters can be cold but not often freezing (now I know what that means having lived in Ballarat!) I just use pjs and a doona with a wool rug on my side. I try to steal heat from the heater I sleep with but I get in trouble for that ;).

I had a 2nd hand lovely resort style lounge (cane with fabric) which quickly became pulled and tatty after my 2 small dogs had been using it. The leather lounge & two large leather recliners I have show no damage (regardless of long or clipped nails) and both pets love these. Having a blanket the dogs know is theirs is a great idea especially with leather, as the initial cold feeling of leather means both dogs only want to be on the blanket.

Wow, that house is WAY to big. How on earth do you clean it? Why not have outdoor entertaining on the back deck? This would incorporate flying fox to a cubby and play equipment down the back yard. In the summer perhaps a collapsible awning for during the day but at night just candles and the stars to keep you company. If the weather is too cold you could provide a pile of crocheted lap rugs or fur or old blankets to get the cottage or french look. I suppose then your dining furniture would need to be a style to suit - maybe more relaxed or boho. Anyway sounds good fun - oo I forgot to allow for the outdoor fireplace (stone or brick) preferably. I notice you said any ideas would be greatly appreciated so I will press on regardless another day.