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Congratulations on your new home. I think you have been very sensible to live in it for a year before starting your decorating, it has given you time to consider the lighting and aspect of each room in all seasons as well as time to evaluate how you want to live in your home and exactly what you need. The lounge does look very big and bulky and will definitely dominate the room, so I would keep to the lighter colour. Don't worry about the kids and dirt - as Kookykaren said, leather cleans easily - sharp objects and textas are your bigger worry regardless of what colour you choose. Laying newspaper on the floor to the size of the lounge is another way of checking how it will look as it gives you a better indication of bulk than tape. I would keep your ottoman simple (one with storage is an excellent idea with the children), just a tone on tone fabric or a pattern using the colours in the rug on the floor of the photo of the lounge. I don't think you have room for too large an ottoman but I would have a square one made the same height as the lounge so when just you and DH are watching TV you can push it against the other end of the lounge and both have a chaise. You can then bring some colour with art work or some patterned cushions on the lounges.

From what you have said, I think smaller separate pieces such as couch and chair(s) rather than a large sectional is likely to work better in the space and still allow for traffic flow. However, if you still have lots to do then don't rush to make large purchases. In the meantime, if your current sectional looks better pulled away from the wall a bit, then perhaps you could rotate the side table so that the long side runs parallel with the sofa arm instead of the wall. Would that help to stop it blocking the doorway and resolve the 'not quite right' placement?

Recliners certainly are great for putting feet up, but will limit where and how you place coffee table. We use ottomans instead as we can move them out of the way when not using, or up against a wall where they provide extra seating if needed. An ottomon with a tray on top can also serve as a coffee/side table. A comfortable sofa with a recliner or two is another option, but you don't want to overcrowd the room. Or one recliner and that funky chair you mentioned! Would need to consider the style of each piece to achieve cohesiveness in the room. Be sure to measure your room carefully, and the considered furniture to ensure the pieces will fit easily.