You may be assuming that the fireplace is meant to heat an entire house. Most are meant to heat one large room. Moving the heat around the entire house gives the available heat more surface to warm, so the result would be a cooler temperature. You may need a bigger fire or a bigger fireplace.
Usually , the heat in homes is shut off by the fireplace because the thermostat is in the living room. The rest of the house is cooled until the fireplace dies down, allowing the thermostat to call for heat from the furnace warming the home. A multizone system with a thermostat upstairs would heat the upstairs whether the fireplace was on or not.