my sister did this (her DH is a contractor). They knocked through the upstairs MB closet turning it into a hallway then put in a floor where the vaulted ceiling over dinning room had been (behind the MB closet).. they also reconfigured the MB bathroom to now have the have the closet.
the only downside was that the windows in the new bedroom went down to the floor instead of the typical 2.5 feet, but that was because the new room had a sloped ceiling too (which made the windows on that wall all sit lower).
it worked (and looked good) but honestly I think it would have been better/easier to just buy a bigger house depending on the market (they later did anyway)