Living Room Makeover NEEDED!

So I need a living room makeover desperately!  We moved into this apartment just over a year ago and we have two little girls so toys are everywhere!  However, our budget is tiny.  I'm not repainting the walls and I'm not getting new furniture so I need to work with what I've got and spend just a little money.

And I introduce my home - in all it's glory - (please ignore the mess - I always feel sad when I see pictures of people's homes online and they look amazing and then I think - their house can't possibly look like that all the time!). 

I am thinking of adding green accents to the living room.  I was thinking of making dining room cushions with this fabric:

54'' Wide Premier Prints Amsterdam...

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Click for larger image and other views         I am  thinking of building a faux fireplace where the tv is (sort of as a new entertainment center).                   Any suggestions would be greatly appreciated!!!