When I need to do a lot of photoshop work (slicing, dicing, css, et cetera), I work from home where I have a large monitor. When I need to do a lot of code work, I take my laptop down to the coffee shop.
Wish I could stick my desk in the living room, but there really isn't any room! It is perpendicular to my south-east-facing window, though, so I get a lot of natural light which seems to help my mood quite a bit.
I couldn't imagine working from home if I lived in a suburb, though. The occasional ten minute breaks (when I'm out of home, instead of out of the coffee shop) to go down and get a cup (or just to have a smoke) are quite nice, because I see a lot of people that I know from the neighborhood. I wouldn't be able to get that, no how no way, out of a suburb.