Lots of good choices here, Certainly I’d look at the new GoldenEar BRX and the Martin Logan 35XTi, perhaps a 2.5 floorstander with 5" drivers like a Monitor Audio Bronze or Silver 200 series, they flank you pricepoint by a couple hundred dollars each way, and will offer better dynamics and bass. The LS3/5a or clones (Harbeth P3ESR, et al) are another route, one I might have taken 20 or 30 years ago but today your budget will buy either an old pair or exactly one new speaker. Not a value. My personal choice would be KEF LS-50s, hands down. From 50Hz up, there is simply no other speaker that has the overall imaging, resolution, neutrality, versatility, technology, and, well, breeding of the LS-50. There are reasons why the LS-50 is the least expensive Class A (Restricted LF) rated speaked by Stereophile - by a factor of 10! It’s because they hold their own with the biggest and most expensive speakers out there and your room size is just about perfect for them. Down the road, when and if you want the last octave of bass, and even better dynamics, a subwoofer (REL?) will provide it. Budget for some decent stands (Pangaea seems to have a good handle on those, without charging an arm and a leg) and decent cables. The only downside, if it is one, is the LS-50s like good clean power, 50-60 watts/ch is the realistic minimum, and 100 watts a side is really the sweet spot. The amp should also be comfortable with 4 Ohm loads. That said,I have heard LS-50s driven by 40W/Channel tubes and were more than engaging,
Acoustical treatment - A few fabric wrapped panels from
https://acousticalsolutions.com/ are definitely the way to go. There are lots of DIY options, but most people simply don’t have the experience, tools, time, or space to build your own. They even have entire room kits (549.99 for the Small, your choice of 10 colors) that will do wonders. I’m using their panels in both my theatre/studio and living room listening areas. I like Acoustical Solutions because they are very high quality, and very reasonably priced.