I'm about to move to a new house without a great space for a shop. I could make do with the basement, but... It's not great; it has no natural light, a gravel floor, a low ceiling and is a bit small. There is no garage or other outbuilding and not a lot a lot of extra land to put one. I use mostly alcohol/caffeine powered tools and am lucky enough to be finally free of wife. I know what you're thinking: Why didn't you get a place that you can put a shop? Because life is complicated, and you do the best you can.
On the other hand there is an extra bedroom which might do nicely, or even the dining room. I mean really, who uses dining rooms nowadays?
I am interested to find out if anyone out there works in a shop in the 'living' part of their house; near kids' bedrooms, kitchens and all that boring stuff. I'm happy to keep whatever machines I use in the basement, but we all know that even handsaws produce a lot of dust, never mind sandpaper. Then there's finishing, which can be planned around. What have you done to keep the place livable and safe? How have you changed the way you work to mitigate the negative effects? Who gave up on the idea and found a better solution?