Some good comments above. My simple suggestion goes like this. Starting at each end, I see they are adjustable, double up the shelves making them stronger, and then you will only have two shelves in each bay. Even them out so yu end up with three equal cubbies. They will look quite cubed, and house foldable fabric baskets which are cheaply available in many colours, try Kmart for packs of 5 for less than 10.00. I would use these end cubes for your practical needs, like onesies, singlets, nappies and creams etc. The central shelves I would display the children's favourite things, on lower shelves, books to access, and some things you want seen as keepsakes, not to play with a they won't reach them easily. The shelves could be configured differently in each space depending on use, but I'd utilize the lower two cubes in one room as desk space, with books above. A cute colourful lamp, and again foldable baskets each side, so that perhaps each child may choose their own side, and have somewhere that's just theirs. In a house ful, it's even more important to have somewhere just for your stuff. These will be great when you make them a little less busy, and providing those inserts will keep them looking tidy, even when they're not. maybe you Could have different colours for each child, to help with the order of things. Good luck with another bub.

having already successfully used steel shed structures several times you may be interested in our latest project, based on a custom designed steel shed but built to residential home standards meeting all BCA, Basix and local council requirements with proper kitchen, bathroom and laundry...this shed is 10.5m x 7m with a steep asymmetrical roof and inside raked ceilings rising to over 3m ... the internal walls are not load bearing so size of rooms can be adjusted to suit but the building has been designed for three bedrooms (although we plan to use the space of two bedroomsas an alfresco area with opening walls) and bath, laundry living and kitchen ..our building is intended as a holiday house in an isolated area and costs include expenses that aren't needed in the suburbs and you should be able to build a similar sized structure as an owner builder for much less than we're spending because there's no power, water or sewerage on our steep site in a bushfire zone so the quote in my last post could be reduced to much less than $100,000 as i realised that you won't have our extra expenses... final costs would depend on your choice of finishes and how much of the work you can do yourself but price for our steel frame was only $17,000 plus $5000 labour to erect... we've chosen steel cladding for the outside because we prefer the look but there's no reason why you couldn't have something else and this photo shows progress to date pending internal walls and plasterboard lining etc

This wasn't your question, but looking at a possible boxed out window in the open plan kitchen dining living it shows just how limited you space is. The following 3D overview shows a boxed out window seat. I have run the kitchen along the same wall as the new window, The Island is 2m x 900 with 1m between the wall base cabinets and the island and 1m between the Island and the wall where your plan shows cabinets. If you have/had cabinets along the other wall as shown on your floor plan they will be 600 deep this would make the island 1400 x 900 which is small. Has your kitchen been renovated and were you considering that, if not. Looking at the overall size of your open plan area I would be considering 1 or 2 large stacker doors to open up to the rear alfresco, that's what I would do but you need to choose what will work for you PS I think that the boxed out window at the front of the house is a lovely idea but possibly not right when it faces West.

Great ideas, dreamer. I love the idea for the front entrance. Would you think going down to 3 bedrooms would reduce the value of the house significantly? What would you suggest with the current entrance and steps? Would you keep them or break them down and seal off that entrance?  For the carport, do you mean directly in front of the house or over the current driveway?  The ground floor does feel pretty "basement" at the moment. The ceilings are a good/normal height, though I can't say the exact measurement at the moment. Maybe a bit too dark for a kitchen and daily living for my preference. There are nice views from the first floor.