In our opinion you will be doing yourself and your home a great service by converting a bedroom to a bath. This will definitely enhance your homes utility now and its sale ability in the future.
The Eckler Team
Century 21 Princeton Properties
If you will be more comfortable in this situation you should do it. You will be living there and your requirments are that you need or would like a large master with a separate bathroom. a three bedroom 2 bathroom colonial with the configuration that you describe is no more or less valauble than what you already have. At the very least if you do a nice quality job it will be updated and possibly be more saleable but not valuable. So if you like it dont be expecting others to but while you are living there you should enjoy your space in the design you like. The property tax should not increase you are not adding sqft to the property or changing the exterior. The value will not be effected either so it will only cost you the permit and construction costs.
If you intend to do this for the sale of the property that would be foolish you will not recoup the investment maybe just make it sell quicker because of the update and new condition.