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A small space works for many uses, if you use dividers
DIY Room Divider Bulletin Board @Christine Turner does this look like something feasible? the concept of plywood connected by hinges, covered w fabric...?
Wood and African Fabric Vlisco Folding Screen Room Divider / Biombo de Madera y Tela Africana Vlisco.
Trying to decide how to make a room divider. I really like this concept, but might make it with fabric....
15 Easy and Amazing Curtains Room Dividers More
Small Space Solutions: Off-the-Wall Room Dividers that Work. This is woven felt divider, seen in Dwell Magazine
BrightNest | Divide and Conquer: 6 Ways to Separate a Room
stretched fabric as a room divider
Instructable - PVC Room Divider 011.jpg