After much agonizing, I've come to a solution that solves my problem 90% & that I'm quite happy with:
The 'new' side table got moved to the adjacent library- where storage was also needed. The current winner is our "C" side table (from Crate & Barrel a year or so ago) which used to slide under the couch. I'm not crazy about having no table near the couch, but it's more of a 'lounger' anyway, so it should be ok. This one blends in without knocking out 1/4th of the fireplace quite nicely. The other one still stands where it was, and at least it provides some of the storage we wanted.
My only concern now is how to brighten up that corner. I have no desire to cover or replace those black Poang cushions, so that's not an option. I actually spent all night fitting and painting cardboard to the back of the built-in -thinking that was sure to do the trick. The back now fades from white to the 'olive oil' chartreuse in the kitchen (with the fireplace beige mixed in too). It blended and brightened so nicely- but you can't see it!! The glare from the glass knocks it out unless you know what you're looking for... and the pictures refuse to show it at all. At least I'm pretty happy with how it looks now... :)