If you don't plan on updating the window treatments just yet, I would take down the swags. They are too small for that nice window.
The previous owner's big mistake was pushing all the furniture against the walls, it makes the space look like a waiting room.
It appears that you have space for two seating areas. I'd consider switching the TV to the corner between the windows or the wall opposite the window and make that the TV area. Then add a small seating area near the fireplace. I'd define the two spots with appropriately sized rugs.
If you could provide a simple floor plan, that may help you get more suggestions.
deegw