All I would do would be to occasionally replace the area rug. Provided it covers most of the tile and you installed it over a good pad, you get the comfort you want and the added bonus of not wrecking the tile.

You have many choices if you go carpet. You can emboss the grout lines and do a double stick rubber cushion with carpet. You also can glue the tack strip and stretch the carpet right over what you have. Or a floating real hardwood would be pretty simple....a good flooring store can look at your situation and give you many options....

Thanks for both suggestions. I wondered if we had enough height under the radiators for the hardwood with an insulating gap. I will look for a good flooring store to come and look.

We have decided on a Karastan nylon midweight (about 5.50/sq ft was the price in the store). They say that the glue they use for the strips will not pull off once the carpet is stretched onto them (I read this in another posting here). It is an old-time shop that we have used once before with wool Karastan fitted carpet and they have their own workers so I imagine they won't be the cheapest but I don't want any issues with installation. We are just about to get a quote from them for the room which is just under 20' by 10' and the store recommended using a 40 lb synthetic felt. Any ballpark figures would be very helpful. We are in Washington DC which is not low rent. Thanks a lot.