While I'm on this small house kick, I'll show you one of the houses in the book which was very small even by my standards! I could see a couple living in this cute little cottage perhaps but not a family and it certainly needs a lot of updating with the strange floorplan. Maybe it's suited for a retirement house or cottage at the lake?
I think I would open the entry hall (porch) to the living room a bit more and install some built-in cubbies with bench and hooks for coats and boots in place of the odd extra door to the small bedroom. While I'm at it, I'd panel the entry in beadboard to take it further into 'cottage' territory. Then extend the kitchen into the dining room for a good sized space. A round dining table could nicely fit into the living room bay window. The closet/pantry behind the kitchen I'd keep for some much needed storage. Informal living in this small house!
The small cloistered bedrooms with overly large hall are really strange -no? I'd keep the hall bath for the bedroom in the upper left hand corner which would have to serve guests too as there is no space for a powder room. Then turn the lower 2 bedrooms and part of that large wasted hall into the master suite. Entry into the suite would be through a small dressing room with access to the corner bedroom with the master bath up against the entry hall. What do you think -is it salvageable?