after working for the council for 15 years, in different rolls, and 1 of them was a manager, i can tell you now that you cannot do a loft conversion on a council owned home!
If you want to change the kitchen you have to ask and then sign a form to say you will be responcible for the kitchen, and if you move you will put it back to how it was...etc etc.
Also as for having kids that its different sex staying in same rooms etc, yes you are entitled to a move but getting 1 is not easy as there are not enough council homes about now.
Best to look at the transfer list, someone might want a swap to a smaller home etc.
If you really think that you want to go for the Loft convert, then first ask if its possible, and if they say no then ask them to put it in writing to you, giving you why they will not let you do it.
Then submit a planning app to the local council, and if it gets the thumbs up, get to your counciler's office and have a chat with him/her, explain that the council cannot move you but you need more space, you have planning for a loft convert and you are willing to pay for it, but the council will not let you because "show letter"
Explain that you dont want to move away and even if you did the council cannot help, and see what the MP can do for you, there is ways round things when you fight, if you did get the go ahead you might only be able to use the council own contracters, if thats so then ask the to pay a % towards it.
But they are all big if's!!
I have seen some things go though because MP's got involved, but never a loft convert, seen a ground floor extension go through, but because of disability, and person did not want to move and council paid for it.
Let us know how you get on.
MB