Oh la la - I love the look of a couch, sofa or bench accompanying a dining table. Casual yet elegant and very accessible. Consider creating a banquette seating design in your small space by multi-tasking your furniture. A lot of small space dwellers use rooms for different purposes and a dining or kitchen table is often placed in the "living room". If so, check out small space sofas like Ikea's Ektrop or Pottery Barn's and slide it up to your table when you hare having guests over to create this look. Check out the photos I snapped at Calypso Home for a little inspiration. 
I find that not all couches are high enough to allow a guest to sit and eat at the table comfortably. Usually the person is too low and looks like a child. I have had guests sit on pillows to raise thier height. This helps, but it can be precarious.
yes - that's a great point. I would consider trying a floor cushion for the seat. although it may be too wide...hmmm, let's think about some ideas.