Here is a photo of our fireplace from the day we bought the house. Being the focal point of the living room, we knew that we had a lot of work to improve this look (especially the ugly red brick).
Here is a photo of the fireplace today. We installed a new slate tile hearth (smaller than the original hearth) and new hardwood floors, so we are making progress.
We have some plans for the built-in bookshelves surrounding the fireplace. We are about 90% sure that we are going to sand the woodwork and stain it to match the floors (and stairs and doors, which will be stained at the same time). We also plan to clean up the back of the display area and replace the wooden shelves with glass shelves.
The most dramatic change will be in covering the awful brick. We have been talking about covering the fireplace wall with stone from floor to ceiling, which would cover the brick, as well as the plaster above the mantle. Meredith sent me this photo months ago ... no matter how hard I work, I don't think our living room will look like this. ;-)
Unfortunately, I do not have the skill to do this type of stone work and make nice, clean, consistent mortar lines. I also think this look may not quite suit our house, which we have kept as a "craftsman" style as much as we can, while also adding in some more modern furniture.
We are now strongly considering installing stack stone on this wall; I am not sure if that is the real name, but see the photos below for samples. This stone can be installed similar to tile, and is typically installed without any mortar or grout lines, so it would be quite an easy install. We have seen some veneers that have a darker mix of stones that range from copper all the way to black, so these would hopefully bring together the tones from the wood, slate, etc. My only apprehension with this stone is that it might be kind of trendy, but I'm hoping that is not the case since it is made of natural stone (as opposed to some of the fake stone veneers from previous decades that now look very dated and tacky). Here are some inspiration photos.
The fireplaces in the above photos look great, but I think the mitred corners look a little fake. I prefer the corners in the following photo, as the corner pieces are interlaced, giving it a more finished look.
I am not sure when we plan to complete this work. It would be nice to do it once the trimwork is intalled so that the living room will be finished, but it will most likely be delayed for some time with projects in the basement and backyard requiring a lot of work over the next six months.