When viewing a single-family home for rent we were told the fireplace was operational buy now that we are renting we are told it is not?

If it was represented to you that the fireplace was working when it is not, you may have a cause of action. This misrepresentation (if it was known that  it was not working) or mistake (if it unknown to the agent that it was not functional) would not ordinaily rise to the level of allowing you to terminate the lease (since not having a fireplace is not generally critical to a residential rental), but would entitle the renters to some compensation--e.g. rent abatement (reduction) to reflect the difference in value between home with fireplace and home without.  In your particular case, if having a fireplace was, as you say, a prerequisite to renting, then you might be able to terminate the lease without penalty, since it was indeed a critical factor in your decision making. However, you would have to be prepared for litigation if you tried to do this (or if you sought compensation), since the landlord would likely take action to enforce the lease; therefore, you need to weigh carefully if it is worth the time, cost, and risk (since the outcome is never guaranteed) of a lawsuit to take action.

If the fireplace in the rental that you have is not for actual wood fires, then perhaps it is a fireplace opertated by natural gas or propane. Have you checked to see if there are gas jets or a line in the unit's hearth?

As to your question your question concerning an operational fireplace and the answer (albeit incorrect) was not a material issue with respect to the rental of the unit. From what you have written, I do not see much that you can do with respect to a rebate or getting out of your lease concerning the false information the agent gave you about the fireplace.