When working in a small area, the key to maintaining functionality is making use of your vertical space.
Wall mount your must-haves: purchase a wall or crib hung monitor and sound machine to avoid the need for end tables or bulky furniture.
Get rid of bins and baskets: put toys and books on shelves instead.
Avoid large stand up toys: skip the rocking horses and plush giraffes. Instead, find wall artwork that adds character.