Basically, we have a teeny tiny Living room which we have a 42" television in. It takes up so much space, as well when you consider I have my PC and we have a dining table as well. I've thought about mounting the Television above the fireplace (non-functional) on the chimney breast itself. Can people give me any reason why I shouldn't do it? I can get a tilt mount to stop neck strain and the boxes are a non-issue.
If as you say the fireplace is non functional then you would not have the issues of heat and soot. As for height provided you use a wall bracket with tilt and your seating is far enough away then again thee should not be an issue. I have a 42" iin the living room which is set at around that height though mine is in a corner. Due to a medical condition my 55" is in the bedroom set very high but tilting down and from my bed is perfect. Itend to favour VonHaus brackets as they are solidly built and come with a massive array of fixings. Do make sure that whatever bracket you get allows you to pull the TV away from the wall as you can guarantee that you will want to get behind it in the future and pulling the TV away from the wall rather than taking it off is far simpler and safer. I get my brackets from here http://www.domu.co.uk/around-the-home/tv-accessories/tv-brackets
I think the height would annoy me, but if there was little other option it wouldn't be terrible. Have you thought of dangerously balancing it on top of the mantelpiece haphazardly secured with masking tape while you decide if it looks right there?
I held it up whilst the wife had a look and she said she wouldn't be opposed to the idea. The only reason it wasn't done before is because she thought it'd look terrible.
We used to have the TV above the fireplace in our old house, I mounted it on some adjustable brackets to angle it down a bit just because it felt odd viewing it so high up with it flush to the wall.
Ideally, the centre of the screen should be mounted roughly at eye height - mounting above the fireplace means that you'll be look up to view the TV (even if you tilt it down), which could be uncomfortable when viewed for long periods of time. I used to do this for a living, and quite often people would insist on mounting TVs above the fireplace despite my recommendations...and I'd quite often get called back after a few months to move the TV somewhere more suitable.
If its the only place you can mout then fair enough, but I personally don't like having to look up at TV or PC monitor for that matter. Really should be so your looking down on it slightly. I've been in peoples homes with t that high up and it just feels plain wrong and uncomfortable.
I think the obvious solution here is to raise the couch to the level of the TV, you can build some kind of storage solution underneath to make better use of space.
We've got ours above the fire place. Like you we had issues of where to put it. We had a 42" before and originally had it in the bay window area. Problem is our bay window looks out at the beach, so it was kinda crappy. So we moved it in front of the fire place but then I kept backing into it with my PC chair. So in the end we mounted it (the 42") above the fire place. It was fine. Not as good as having it lower down I will admit but yeah, if space (or window views) are at a premium then give it a go. Definitely angle it down slightly (don't get a crappy fixed bracket) and you will get used to it