The bedroom issue, not altogether surprisingly, is a perennial issue on the step parenting board. And someone always suggests "move then" - or words to that effect, like just upping and moving is an option anyone can avail themselves of without a second thought. Quite apart from affordability which is a huge and unavoidable concern for many families as is negative equity for quite a few too, you also have to think about jobs, schools, dependent relatives and so on. In any case, the OP here has clearly stated she can't move right now so all she does have to play with is a 2 bed house.
Personally, I agree that a small baby can of course share its parents' room for many months. However, having had to do this by necessity myself for almost 14 months, I can say that by the end of that period, when I was finally able to move - thankfully - to a larger place, it was a lot easier to settle an older baby/toddler down for the night in their own space. I certainly wouldn't wanted to have continued that set up - if at all possible - past that age, as it was relatively difficult to access your own room once the baby had gone down, or indeed to feel uninhibited IYWIM with a by-then alert little person there too. I know the OP's saying it's only one night and of course we've all stayed away from home and shared with a baby or kids but if it's one night every week I'd be a bit worried about perpetually shifting the youngest from one room to another if they were a remotely poor sleeper - as mine was - because the change of scenery could well lead to them taking longer to settle etc.
So .... that leaves the issue of how to include everyone and not step on toes. I agree that for the older child, sharing a room wouldn't have to be the end of the world necessarily. While the youngest is still primary age I certainly wouldn't worry about the sex of the child either. Okay - I "get" that the older child may want privacy and there might be the issue of "pestering" from a younger one, plus the safety concerns of keeping all potentially dangerous teen stuff like scissors, tweezers, straighteners, lotions etc out of reach, but that sort of issue should be able to be sorted practically with high shelving, lockable cupboards/chests and the co-operation of the teen. As someone said before, it's unlikely that a very young child would spend that long in said room playing as most of us just wouldn't want them out of sight for too long in case of accidents so to them, at least initially, it would be more about a place to sleep than anything. Maybe the only thing would be whether or not the teen used their room much of an evening after the baby/toddler went to bed ...... but really, I think maybe you can spend too long analysing stuff like this as loads of families do have to share and they find a way round it one way or another. I once knew someone who had 5 boys, 2 girls, in a 3 bed house, with the gap between oldest and youngest boy being 15 years - yet they all managed (with lots of bunkbeds) and were a very happy family.
Alternatively, you might have to think out of the box a bit. As someone else suggested - a loft conversion might be the answer, or even a garage conversion if you have an integral garage. Similarly, do you have a self contained dining room and/or conservatory. It might be possible to turn either of those rooms into another bedroom on a weekly basis ...... perhaps redecorating it with SD's imput first off, something which would be equally acceptable for a dining room or a bedroom, and then move the table etc into the garage/shed/hall (as appropriate) when she stays over so it's definitely her room. You could get a really funky futon plus a big chest for all her stuff, maybe bedside lamp and other small personal things like cushions, beanbags etc which could either be stored elsewhere when she wasn't there, or even pushed into the corner of the room.