The padding and carpet on your walls (besides being a fire hazard) is actually making your room less clear. It's probably killed the high frequency ringing (i.e. the ring you get when you clap your hands in an empty room), but it's also killed all of the highs while leaving the mids and lows untamed, resulting in a muddy room that will never be clear.
For $200, you can get 12 sheets Owens Corning 703, wrap it in burlap, and use fender washers to attach them to the walls. This will kill the ring, help with the bass, NOT BE A FIRE HAZARD, and not be nearly as ghetto.