Would there be room in the kitchen to put a small cafe table and a few chairs? Or is it just because your hubs doesn't want strangers in your house? I assume you'd be by appointment only, so he could make sure you had back up if something goes awry.
Could you look into getting a fold down table (attached to the wall) that you can use if you need it? Maybe some folding chairs stashed away somewhere.
Being a home based business myself, I make sure that my house is neat and clean when customers come to pickup cakes. Is it a pain when you are working last minute on a cake and your place is a bit of a wreck...sure, but I, personally, would be weary of ordering a cake where I didn't have the option of seeing where it's made.
I would just be thinking, the house must be embarrassingly dirty, messy, do they smoke, pets everywhere...
If you meet with them in the kitchen, no matter how small, you could assure them that you do all your work in there and it's kept clean.
And they wouldn't see the rest of your house, so who cares?
If you are worried about your environment (neighborhood, your yard is filled with trash, etc.), there are things you can do something about and things you can't. You can clean up your yard, but moving surely isn't an option. Or your neighbor's yard is a mess. If that's the case, I would def try to hold them at a coffee shop or something. Bring a gift bag of samplings for them to take home, I'm sure you'd be frowned upon bringing your own food. But if you order coffee for your customer, I don't think they can kick you out for doing business...isn't that what they are for?! I always see people meeting up at Sbucks or working on their laptops.
So lots of factors...do you feel comfortable elaborating?