First of all, many thanks for sparing your precious time for looking into the plan and sharing valuable thoughts.
Basically I like to have that open area accessible through a door because that can be used as laundry space for washing machine etc., secondly the attached washroom needs exhaust, don't you think open area is necessary for this. And if we move bathroom as per your suggestion we'll have to keep its door in the middle of the room, would that look good?
Your concern regarding kitchen size is very valid, how can we improve using current space? removing door at all or removing the wall in between?