We have a spare bedroom - it's used for the kids to watch TV or play video games, me to quilt and also has a trundle bed for overnight guests. I use the closets in the room for my material and supplies and storage. Wish I could have a cutting table, but I just move the machine off the table when I'm cutting. I can shut the door when it looks too cluttered, but I like to keep it fairly neat and organized.
I iron in the laundry room - across the house, but the iron in the spare bedroom will make the lights dim if I use it there - don't want to cause an electrical disaster...