Would you consider a hanging fireplace like this?

Don't try to bypass the approvals process as it will come back to bite you on the bum when it comes to selling your home. Nobody wants to buy real esate that has illegal construction so it will actually devlaue your home. The requirements for approvals vary from state to state, and sometimes even council to council. However with the type of boundary construction, and the length of it will probably require DA approval in most areas of Australia. Best to have a friendly, informal chat with one of the planners at council who should be able to advise you in the requirements for your locality. Or enage a local architect/designer who is familiar with terrace house renovations, who will handle the design, documentation and permit applications for you. The photo supplied by Siriuskey with the glazed roof over the kitchen was created by a design professional. Best of luck, Dr Retro of Dr Retro House Calls

HU-624382943's comment about speaker placement is important. As far as quality listening goes (whether you like listening to music seriously or want to enjoy fantastic sound when watching movies, you want the speakers on the narrow wall (pointing towards the set of paned windows), not on a long wall. The challenge, of course, will be to get them sufficiently spaced, since you have the bookcase on the right and the cupboard (with or without doors) on the left, as well as the door to the room itself. (That door looks uncomfortably close to the cupboard doors, incidentally.) Unless you choose to suspend your directional speakers from the ceiling – which could be an option – you'll probably be limited to the width of that central section of wall, i.e. immediately to each side of the TV.

Looks interesting. Does this plan extend beyond the property to the street kerb, borrowing space from public realm? I assume that is the public footpath running straight through. How will it look along the streetscape. Can people park at kerb and walk across. Where do bins get placed for collection. Do you have image of one you have done?