If at all possible, I believe that it is important to have a separate space for schoolwork. Just like adults, children need to be able to have a space, relatively free of distractions, to focus, a space that communicates, without words, that a different kind of play is to take place 'there'. What does that look like for a young child? In my mind, it looks like a bright room that is colorful but in an age-appropriate manner (perhaps lots of contrasts for a baby and becomes more neutral as the child gets older). That's why I love this sunroom on the second floor of our home. It is separated by a soft retractable gate from my son's bedroom, below. This separation ensures that Joey does not touch any of the school stuff in his off hours because some of it is not appropriate to be used without supervision. This separation is also psychological because he too needs some downtime.
In his bedroom, there is a little piano (which he can play when he wants), and lots of books that he is currently allowed to switch at will (so he is allowed to get out of bed to change books if he wants to, something he was not allowed to do when he turned three and we switched to a big boy bed). He can have up to five books in his bed or night table. We keep regular toys in a toy box in our living room downstairs and there are also some toys we keep in a closet in his bedroom, and which we only take out for quiet time (now replacing naps on the week-ends). The relative lack of distractions in his bedroom is really helpful, I think, because he ends up spending a lot of time reading or drawing/writing on a doodle pad if he doesn't want to sleep. Note that the bookshelf is secured to the wall. Regarding the rest of his bedroom/schoolroom set up, I believe several elements are conducive to achieving good results:
In his bedroom, there is a little piano (which he can play when he wants), and lots of books that he is currently allowed to switch at will (so he is allowed to get out of bed to change books if he wants to, something he was not allowed to do when he turned three and we switched to a big boy bed). He can have up to five books in his bed or night table. We keep regular toys in a toy box in our living room downstairs and there are also some toys we keep in a closet in his bedroom, and which we only take out for quiet time (now replacing naps on the week-ends). The relative lack of distractions in his bedroom is really helpful, I think, because he ends up spending a lot of time reading or drawing/writing on a doodle pad if he doesn't want to sleep. Note that the bookshelf is secured to the wall. Regarding the rest of his bedroom/schoolroom set up, I believe several elements are conducive to achieving good results:
A desk area: this may seem obvious, but a good, age-appropriate desk is really important to host learning activities, particularly anything involving writing, drawing, or computer work. For other work, however, I believe it is important to be willing to keep switching locations (like the floor) for young children because they don't want to be sitting at a desk non-stop for hours. Note the clock, which helps reinforce reading the time, the handy roll of paper, and the posted schedule. Also, unless you are buying really good quality furniture, plan on a plexiglas protective cover for the desk because preschoolers put a lot of pressure on pens and ours needs to be replaced a year after we purchased it because it is full of scratches. 
A lot of easily accessible storage: again, this may seem obvious, but it is important to have good storage to keep teaching books and other learning material well organized and yet readily accessible. We opted for these open cubbies, but if you do the same, be sure they are super-stable or secured to the wall, if you have the kind of child who will try to climb on them. This is also why we keep a gate between the work area, where Joey is always supervised, and Joey's bedroom, where of course he spends his sleeping hours unsupervised. These cubbies are also great to keep a child laptop and DVD player out of little hands' reach.
A reading corner: apart from the ability to read in bed, a comfortable chair in a little corner makes the perfect quiet place to read. Note the magnetic calendar to help reinforce calendaring skills. We use the Educational Insights Geosafari Talking Globe Jr. to teach geography. A music corner: this one has to be as free of distractions as possible, but clearly, for us, it is just a little corner of our mini-classroom. We have been doing Suzuki violin, and after a while, I felt it was important to get a stand and a music pointer.
And finally, an award or achievement wall: as your child has been working hard to take classes early, get into Mensa, or participate in Continental Math Leagues, display his achievements on a special wall. It will be a good reminder (for you and him) that hard work pays off!
