So here is what you can do with a 1200 square foot attic:
This drawing is very close to what I had roughly sketched out. We won't have two closets off the front master bedroom, right now we share a closet that big and it is plenty. So one of the two other rooms will get a walk in closet as well.
The bathroom is just a rough idea, we may want/need to change the layout there. Currently there would be no window, so either adding one or a skylight would be advantageous.
We had not thought about a second floor laundary, but the storage space I envisioned is right above the kitchen sink.
The added gable to the rear of the house allows for head room at the top of the stairs, and natural light and ventilation from the rear of the house. That would be a sitting area with railing on both sides of the stair. The rear gable had to be offset a foor from center to allow headroom at top of stairs. The hallway to the front bedroom is aligned with the rear gable window rather than the front window.