Simplify is always a good strategy with play rooms. The temptation to cover the walls with artwork and posters can add to the visual clutter. I would suggest a larger area rug to ground the space and create a soft place for playing on the floor. A medium colour with a fleck from other hues in the curtains and upholstery will help hide dirt and lint. I think you could definitely cozy it up with a warm wall colour to unify the space. Lastly, closed storage for the toys goes a long way to creating order from the chaos. You will have a lovely space the children enjoy and you find restful.

You could use roman shades and panels on the sides or room darkening curtains, the first set of draperies are available at Bed, Bath and Beyond :-)

Take out sofa, use beanbags and those blow up seats for their friends. Coloured rugs for tumbling and crawling on. Supersoft teddy bear blankets so they can curl up. Add in one of those soft blanket boxes for toy storage and so you have somewhere soft to perch when you are with them. Paper half way up the wall in the wall paper that kids can draw on, so they can decorate in whatever colour they like and you won't mind. A childs lift up desk, bookcase and some crazy lamps in weird colours. Then close the door, collapse on the sofa that you have moved, breathe a sigh of relief and thank your lucky stars that you have another room for the kids to go to. (Grab wine and pretend they aren't yours for half an hour! ;-) )

If it all fits in then why not. I don't think the desk will go with the bed or maybe it would work it the desk was painted. Do you need the desk or could you use a smaller console table for working/doing things from ? Not a fan of sliding doors would rather swop the door so it opens the other way if space is an issue. What is going on the shelves are they needed ?