your next design challenge: a rug that sears your retinas

Here's a picture of our front lawn:

Here's a picture of the carpet in the new house:

This looks a bit teal, does it not? I assure you it is an ugly hunter green. 

Notice any similarities?

In the house we will be moving into, two flights of stairs and the entire third floor are covered in grass-green carpet. Actually, I think the lawn color is more attractive than this carpet. Its a pretty high quality rug and very soft.  Its high pile, so another rug layered on top probably won't work well.  Its a rental, so removing and replacing all that carpet is not an option.

This color is not in my top 5, top 10, or even top 100 colors I might want to decorate around.

I can live with the stairs being this color, I guess.

My dilemma is the third floor.  It is spacious, has room for lots of furniture, has a large main room and a smaller room in front, and is covered wall to wall in emerald green carpet.  The "master" bedroom, on the second floor, is fairly small, will be quite cramped with a king size bed and one dresser, and has a "walk-in" closet that when I walk into it, hangers brush both sides of my head.  Thus, my dilemma is do I make the attic the playroom, and keep the master on the second floor, or do I make the more spacious attic our master bedroom, and put the playroom in the tiny master bedroom on the second floor?

Option 1: Use the third floor as a playroom, and keep the tiny "master bedroom" on the second floor.  From a design/aesthetics perspective, this works great.  Functionally, it kind of sucks.
Pros:
-My white and green Ikea Stockholm Blad curtains in our current playroom, and the green baskets we already own will work with the emerald green carpet.  Designing around the ugly carpet problem solved!
-the main attic space will make a nice playroom
-the little second room will be a nice office space for me and the Mister, and I can hang out in the office when the kids are the playroom
-I can pick whatever design I like for the master bedroom on the second floor

Cons:
-The master on the second floor is SMALL.  We have a king size bed, a long dresser, and a tall dresser. I don't think this will all fit in the room, and if it does, its certainly going to be cramped.
-Where will all our clothes go? There is definitely not enough hanging space in the closet for the two of us.
-The attic is gabled with low sloped ceilings, so I will have to buy more low cube units to store toys, as the tall Expedit we have currently will not fit in the attic.
-The Purple Beast sofa will not make it up two flight of stairs, so I'll need some other seating arrangement.

OPTION 2
Make the attic the master bedroom, and put the playroom on the second floor.

Pros:
-IF--and this is a big IF--I can get all the furniture up the second flight of stairs, the attic is plenty large enough for our bed, furniture and clothing storage (we sound like clothes horses, don't we?)
- its the third floor, I can just shut the door, no one but me and the Mister ever has to go up there.
-having a playroom on the second floor would be a wee bit easier to hear and keep an eye on the kids while making dinner, etc.
-most of our playroom furniture would fit in the master bedroom, including the Expedit unit

Cons:
-SUFFERING THAT CARPET IN MY BEDROOM, OH THE HUMANITY
-seriously, I'd have to design my calm, relaxing bedroom around that damn carpet
-did I mention the carpet?
-I'd have to look at that carpet every morning and every evening
-I think we can get the bed up there (it was delivered to our house folded in half, so I'm assuming we can do the same thing to get it up the stairs), but I am unsure that the two dressers would make it up the turn in the middle of the stairwell. I could be forced into keeping the attic as a playroom regardless.
-that carpet.  Seriously, that carpet.
-No, a throw rug or five throw rugs are not going to cover it up.  That carpet is there to stay.

I have six weeks to figure out what to do.  Invisible internet friends, what should I do?