Hello Jeannette, what a lovely project! I've worked on a number of bungalows and they have their own unique challenges. Making the spaces work for our needs today, and for your own family needs have to be the priorities. I would suggest you appoint an interior designer before thinking in detail about the kitchen. An interior designer will find out how you want to use the space and come up with clever floor plan that is workable and beautiful. This is going to be a really important investment for you. I would love to help - I couldn't advise in any detail without seeing the property and of course, without meeting you. Very best wishes Yasmin.

If you wanted to knock the wall down, you could have sliding pocket doors so you have the option to close off the lounge if you wanted too. If you have an island, I don’t think you will have much room for a dining room unless you move it into the sun room as Jonathon suggested. What would the island be used for? Will you be having any sink / hob there or will it just be a worktop used as a breakfast bar, preparing food etc?

The garden is south facing so the sun comes through the kitchen and living room windows. We have thought about going into the the Living room, our Hesitation is it’s a good sized room with a nice fireplace. We have also thought about maybe extending out a metre or so from the kitchen to square it off but assuming this would be pretty expensive to do

Option... 10 minute job to remove the door as a test, if you're handy with a screwdriver - and live with it like that for a while, see if you miss the door or wish the opening was wider? (leave the middle screw in the top hinge until last so it only moves when you are ready) It makes a difference actually removing the door vs. having it open.