Reflection, Diffusion, Absorption
Sound behaves in much the same way as light. Shine a flashlight at a mirror in a dark room, and a hard glare will be reflected right back into your eyes. Shine the same flashlight onto a frosted piece of glass, and you'll notice that the light is evenly distributed in a pleasing circle on the surface of the glass, which will also reflect more light around the dark room than the mirror did. Apply this to music in an enclosed space, and you can understand why diffusion — the random scattering of sound — is far better than hard reflection. The latter makes the music itself sound hard and brittle, while diffusion provides clarity, warmth, and an evenness of sound throughout the room. And because diffusion more evenly distributes high- and mid-frequency sound throughout a room, it adds greatly to musical clarity.
Absorption is useful in reducing the amount of sonic energy in a room. Many people make the mistake of cutting down reflections by deadening their music rooms with heavy draperies, thick carpets, and overstuffed furniture. However, this will not absorb all frequencies evenly, and can make a room sound dull in the upper octaves and too heavy in the bass — or the other way around. While in "live" rooms some absorption is desirable, even necessary, I suggest a combination of absorption and diffusion. This can be done by placing books, bookcases, artworks, chairs, and other randomly shaped objects along the walls to break up reflections, as well as scattering around the room some soft surfaces, such as upholstered furniture. Some of the best music rooms have mostly hard surfaces with little absorption, but they all have many diffusive surfaces that break up the reflections, which keeps the sound live, warm, and resonant. Partially closed wooden blinds or other irregularly shaped treatments for windows and glass doors will help diffuse reflections coming off of those glass surfaces. Note that flat artworks, even when not covered with glass, can cause degrading reflections unless they have a very irregular diffusive surface. Fabric wall hangings, especially quilts and other thick, soft, irregular surfaces, can absorb a lot of high-frequency reflections, when used in moderation — but not heavy drapes, unless the room is especially "live" and reverberant.