What makes a room a "legendary dining hall"?
Room value is determined by the quality of the floors and walls of the room, and any items in it. You can increase a room's value by smoothing and engraving it. Engravings have quality of their own, so it's best to use a highly skilled engraver to do that work. Adding high value items such as statues also helps raise the value. Also keep in mind the size of the room and the material the room is dug out of has an effect; who wouldn't want to live in a grand room made out of Gold?