granite-girl, thanks for your comments.
option 1 is least headache. but in the future if we are to add the master bed and bath, it will be completely separated from the other beds. Initially we thought, great, privacy. but then someone mentioned to us, it will be difficult after we have kids (can't hear them or get to them quick?)
9'-9" x 11' is for kid's bedroom. a bit small but I think we can make do.
at the bottom of the big bed is not a walk in. It's divided into half. left is the living room entry closet and right one is a 3x4 or so closet. not sure if the bottom wall (marked as 9'10") is load bearing.
we are debating between option 1 and 4
any more ideas?