As far as modernising Headingley goes, they built the Carnegie Stand and were meant to be doing the southstand last year but had to pay the RFL £1m for some reason I can't remember. This put it on the back burner. Then they decided to prioritise the pitch.
The Southstand will happen in the next couple of years as a larger version of what Warrington have. They even knocked the supporters bar down in the southstand car park in preparation for it. There was a vote to see what type of stand we were going for. The Leeds fans voted for an updated, all standing area instead if a seating standing mix. Originally Leeds wanted it to hold 12k instead of the 8k it holds now but residents around the area stopped the 4m rise in the height so it'll be a similar size to what it is now.
Then the main, north stand will be last. It can't be done though until the cricket side decide to do theirs as its the same structure and both parties have to have the money to complete it together. I can't see that being too long though because its the only area of the cricket side that hasn't been redone in the last decade.
As for the Western Terrace, it's the only part of the ground that can't have much done with it. Directly Behind the terrace is a public walkway. About 2 metres the otherside of the back of the terrace are people's gardens. Maybe 10/15m or so away from the terrace are people's houses. That means we can't go higher and can't really roof it. There was talk a year or so ago that Caddick (owner of Leeds and owns a big construction company) was going to buy the houses to demolish them, but I'm not sure how real that was. There is a brand new scoreboard and a permanent big screen (10m by 10m) on there though which all adds to the game day experience. Even non televised games are shown on the screen with replays after incidents and tries and have been for the last 3 years. I don't know any other team in the league that has, or does that.
I agree, it does need modernising and is in the process. It doesn't just happen over night though and it costs money. The size is good though. Leeds haven't had a 20,000 crowd in 4 years but are always between 75% and 90% full.