I have the same situation. Both my daughter and stepdaughter have their own rooms right now, but the thought of having more kids I've had to think about room situation. Because my stepdaughter is only over 1 or 2 nights a month, there is no reason one room should stand empty with so many people in the house.
I would first approach him by saying that she has her own room all to herself at her mothers house, and that it is only fair that your kids have the same. Not to forget that you and your husband need time for yourselve's also.
It's very possible that your husband feels guilty for not being able to spend a lot of time with is daughter, and by giving her her own roomhe is making up for it. Which is just something to keep in mind when approaching this situation that needs to be dealt with either way.
My suggestion would be that you (and me) do a little bit of homework (looking at magazines, visiting Lowe's online etc.) and come up with a creative way to partition the room. You can decorate her side to play it up a little more, to make-up for the loss of space (which will soothe this ordeal for him as much as for her).
Your children should not feel second in their own home.
My sister and I grew up going back and forth between our parents each week. We had separate rooms at each house. When my stepmother got pregnant, we had to share a room while the baby had her own. I'm not sure if my father had a hard time making that decision, but we didn't have a problem with it. Sometimes its a bigger deal for the parents than it is for the kids.