I have yet to meet an individual who has, in the last 10 years, both remodeled a kitchen and adopted an austere entertainment budget (in which I include restaurants and movies).
I doubt anybody would claim my entertainment budget is "austere", but it is substantially reduced from what it was when we lived in a smaller place. We almost completely stopped ordering out on weekdays, and we eat out about half as much as we used to on weekends.
We went from buying everything, to buying only things we don't know how to cook, or that are a pain to cook.
A fancy kitchen might correlate to fewer restaurant meals and less prepared food purchases.
A media room might correlate to less money spent on theater or movie tickets.
Sure, there needs to be a budget, but your post denies that household spending can be reallocated from one column to another.