I am always looking for ways to add style and functionality to my small space and I love the look of banquette seating. Here's a few photos of a wine tasting room in Los Olivos that has successfully pulled this look together. (plus a few more of the pretty space and, of course, the wine!)
This look is actually pretty easy to do. Since most rooms in small spaces double in functionality (living room meets dining room meets office), consider creating a banquette when you have friends over. Pick up a tulip table (IKEA has an affordable version) and add it to your living space to entertain. When you don't need the table and don't have room for it, consider taking it apart and storing it away.