Design advice for a small studio

To view pics of the gutted space use this link http://gallery.me.com/stoneskipper#100014 My friend and I are working on a design for his new studio. We are converting the existing garage. The gutted space is 273 sq. feet. 21' long and 13' wide with an 8' ceiling. We plan on building an interior 2x4 framed surround wall inside the existing 2x4 exterior wall with a 1" spacing between them so the finished interior dimensions will be closer to 20' x 12' or 240 sq. ft. We are using Mr. Rod Gervais book to guide us and the basic takeaway we've gotten from his book on rooms this small is that it doesn't make sense to try to alter the shape of the room with the interior surround walls but rather to address the acoustical issues with treatment alone. We want to open up a discussion to get whatever advice we can on how best treat a room this size. It will primarily be a mixing room with a vocal booth in the rear of the room. Some tracking of guitar as well as other kinds of acoustic instruments will also be done in the space. So far we plan on using panels in the corners for bass traps and panels at the early reflection points on the walls for early reflection control, using a mirror to place them as suggested in Mr. Gervais book. We aren't sure yet how best to treat the ceiling. Should we use a Cloud over the mix position or treat the whole ceiling? There will be a hardwood floor so the floor will be reflective. The room will not be used to track drums although it may be used to track some percussion. Some of this can be done in the vocal booth which will be 6'x4'. Should we consider using any diffusion in a room this small? Also one of the challenges we are struggling with is the existing niche storage in one of the side walls (see pics). It goes under the outside stairs and while my friend would like to keep it were not sure what it's impact will be on the room. it certainly will be a weak link in terms of soundproofing and aside from that I'm afraid it will introduce some difficult anomalies into the acoustics of the space. Your feedback is much appreciated.