As someone who has "taken a lot of time off" to spend time _on_ the things I think are important, may I suggest answering the work question with "I'm currently working on _____" or "Right now I'm spending a lot of time on _____". There are a hundred ways to direct the conversation somewhere productive and fun, but "I don't currently work anywhere and am taking some time off" does sound like an embarrassed euphemism for "unemployed." Don't be embarrassed.