Where to put the litterbox?

Seriously, never use it except when it's no longer there.

That's cats for you. 

We have a 2 bed terraced house. I used to have the box in the bathroom (which is downstairs in an extension), then it was in the kitchen until we had that redone. Now it sits in front of the back door (in the extension) and moved when we need to go out for the bins etc, to the other side of the hall but that blocks the doorway to the cupboard where the boiler and dryer is!
My cat always used to go out and didn't need a litter box (as we have a cat flap) until a few years back when a neighbour had a big Alsatian dog, although the fence was such that it couldn't get over, the cat would have to walk close to the fence and was just scared to go out. So even though they've moved she rarely goes out now, and she is getting on now (she's 18!)

I had the same worry when we first got our cat. We were living in a one bedroom flat with a teeny bathroom, so the only options for the litterbox was the room where we slept or the room where we ate. We ended up putting it in corner of the main room farthest away from the dining table.

What really made it work though: instead of a normal litterbox that gets stinky the second a cat uses it, we got a Littermaid automatic box (http://www.petplanet.co.uk/product.asp?dept_id=776&pf_id=50117 [nofollow] ). It's not perfect, but it definitely helps - at least we don't smell poo the second we walk into the house.

There's a (slowly) growing market in automatic litterboxes here that is starting to catch up with those in the US, but they're usually only available online. My inlaws thought we were crazy for not only keeping the cats inside but also spending so much on a robotic litter box, but seriously, it's the best thing since domesticated cats! 

we keep ours in the conservatory. luckily the door shuts enough to keep drafts out and the kitten can still get in there to do his thing. The large cat won't use a kitty litter anymore and demands to be let out... I'm hoping he trains the kitten soon.