Pillow room: don't spend money on couches or lounge chairs and buy a really nice movie screen. (This would be really fun for movie night, to just move all the living room furniture and bring out the pillows!
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Home theater room in the attic. A more do-able idea than those other fancy home theater rooms! Much cozier and warmer than the individual recliners in rows that you see in a lot of fancy home theater rooms