hi Elizabeth, I can understand that brown bricks wouldn't be very nice to see in your loungeroom, and in regards to the hole are you capable of bricking it up with bricks, it wouldn't have to be a good job, because once it's done and painted, you will not notice it.
It sounds like it was a chimney.
You could leave the chipboard, but for me, I wouldn't be happy with that, the hardware stores have premixed bags of mortar, but a local handyman might do it cheaper for you or a friend who is handy, because the premix mortar has never been the best when I used it for small jobs.
If you move the benches then the tiles on top of the benches will have to come off, but I need to know what type of floor tiles you have on the floor.
If you have ceramic tiles they may come off easily using a chisel, or if the tiles are cemented onto a false flooring such as 'hardiplank' or 'masonite', then you maybe able to lift the sheeting, but it's not going to be easy.
There would a false cover at the bottom of your cupboards which may pull off.
The flooring needs to be pulled up first, and you can do the painting without the new floor, when everything has been put in place, plus the hole has to be fixed before any painting is done.
If you do the painting and everything is in place get some covers so that nothing will get paint on it. Geoff.