How to recover square footabe from the living room

[Dan Nad]

This is a question about how to get the most square footage from the layout. I've been looking at townhomes with between 800-1200 sq ft. Usually the front door opens into the living room and the stairs. The living room functions essentially as a hallway for traffic up/down and in/out, rendering the living room useless as a place to hang out, unless you want people passing through all the time. Some rehabbers deal with this by opening up the entire space and turning the living room/kitchen/dining room into one space. That works for some people, but it has drawbacks. One alternative I've seen is putting the front door in the kitchen. 

Anyway, my question is how people have dealt with this problem. Is the living room dead space? Is the kitchen a better focal point for the house? Has anybody tried reversing the stairs to land in the kitchen and not in the living room?