I think the important point is, you like the lot, and you like the neighborhood. You are planning to stay there for 10 years.
Just wondering, if you did do a $150K remodel, could you turn around and recoup that money? Ask a realtor if you don't know, and whether it is more cost effective to move or remodel.
I would not be surprised at all if the remodel is more cost-effective. Hopefully with these changes not only are you getting more usable space, you are also getting more "space" as well, otherwise the remodel does sound expensive (that's equivalent to $250 a square feet!).
Do your due dilligence, get multiple quotes and work with someone who has references you can call and talk to. You really have to be on top of the contractor otherwise the cost will balloon (this always happens because issues are discovered). Be willing to cut back in some areas if that happens, to achieve what is most important to you and stay in your budget.