I didn't think of this tip, but many of you wrote in and said that close quarters enhances roleplaying. Reflecting back, many of my best sessions have been around card tables and other small tables, or in small rooms. I think the closeness creates focus and intensity. It gives you feelings of coziness, friendship and camaraderie. There's so many things a GM must think about and so many questions and statements to answer from the players.
Most GMs get too busy to notice quiet or non-participative players.
So, having everyone close together probably lets everyone participate on a more equal level. This is an obvious, but extremely important tip. When my game gets disrupted from a distraction, I can almost feel the mood, focus and fun drain away from the table. A distraction is like a game master rolling a critical miss. The same with players who need to cook, smoke, go to the washroom frequently, etc.