Hello everyone!

My basement has ledges all around it and we are not sure how in the world we are going to decorate/remodel/what have you. I've already remodeled the kitchen (on the cheap, though it looks very nice) and am not looking to put too much money into the basement, so serious remodeling is out of the question.
The previous owner used the basement as his bedroom so his son could have the main floor bedroom to himself. He managed to make it somewhat homey by framing a wall to partition the mechanical parts and put plywood up all over. Not a bad idea, but it's not the prettiest room by any means. Here are some pictures (click on them to see larger ones - if this doesn't work, please go to
http://www.kelley.nu/basement to see the pictures):
I would like to make this an office/craft place, but with a little bit of style. I've got a vision of wood-like laminate floors (or tinted cement if that's a bad idea), white baseboards (to fit in with the rest of the house), and a coat of plaster in a warm color scheme to cover up the true identity of the plywood and make it feel like a comfy space. The ledges, however, are a bother and I'm not quite sure what the heck to do with them. We could carpet them, but then the floor would look silly unless I carpet that, too and I'm not sure that's a good idea. Plus, they seem to be flaking a bit of cement off, so I know this is something I need to remedy soon.
Does anyone have any suggestions on what to do with the space? Especially the ledges?
Thanks in advance! Any help is appreciated!
Bella!