I'm glad to know you guys don't like deglossers over sanding. I'm a professional decorative painter and always choose hand sanding on furniture pieces but have been tempted a few times to try a deglosser. I also agree that sanding and thoroughly cleaning trim in preparation is not a fun job, lol. A few years back I had a client who had a paint crew come on and put latex over oil painted trim...absolute disaster....ended in a lawsuit. I have pretty good luck with sanding and a bonding primer like 123 or C2... But a recently repainted a cabinet that had been done in oil and I did have some adhesion issues....I remember wishing I had just repainted the darn thing in oil. I believe one of the companies makes a non smelly oil based primer now, but I tried one and didn't care for the way it laid out...brush strokes. 123 levels out nicely, which is why I use that a lot. I would think using an oil based primer would be another way to eliminate sanding, though. Many of the oil primers say they can be topcoated with latex. Which always seems odd to me too! Maybe because they dry to a flatter sheen, gives the latex something to grip. I agree that the easiest thing is to thoroughly clean and repaint with oil like Ben Moore satin impervo, but aside for the yellowing factor, the op was considering a zero voc paint so oil is not gonna give you that....and the whole hassle of cleanup, of course. Oh, and when you see a primer that says it requires no sanding- ignore that. If you want to ENSURE latex sticks over oil, sand, and clean well. I was lazy painting over my own oil trim with 123 primer, and where I sanded it stuck well, and where I omitted the sanding, it didn't.

Yikes! It's peeling because there was literally nothing for the paint to stick to, except for the tape, that is. Before you paint any slick surface, you should at least give it a good sanding, (known as giving it a tooth) and then prime. Also, you shouldn't use latex over an oil paint. But, none of that matters now. You can A). completely sand the surface, prime and then paint again. Or, B). have a panel cut to fit; 1/8" beadboard or MDF, then prime & paint the new surface, trim out top, bottom and 2 sides with a small profile moulding. Make sure your shelves will fit w/the moulding, or you can simply use caulk if there is a gap. (I also posted this on the paint forum, but thought I'd put it here, too) I hope this helps, and I do love the look of a contrasting color on cabinets.

If it were me and I were doing that, I would sand the paint as best possible. Then I would try using a wallpaper liner which is just plain white wallpaper and which is a better application for this project, OR I would use anaglypta which allows for imperfections in walls, etc., plus you can paint anglypta many, many times over. I have anglypta that I used in my kitchen area (but not breakfast area) which are adjacent but separated by architectural design so that I did not have to have the total continuity. I decided to do a backsplash of tile which meant I had anaglypta just "there," there doing nothing. I painted it the same color as the rest of the kitchen. People who notice it say, "hey, that faux painting stuff looks good, why don't you finish the rest of the room in that?" Well, maybe one day I will but now I am tired and no longer hang paper secondary to health issues but I have a closet full of the cheap stuff which can be made to look very elegant by painting and dry brushing with a color, wood glaze or a metallic glaze. I think mine has been painted 7 times since I put it up 13 years ago.

Use a stripper(eco friendly types work ok) and remove all the old paint. Reason? If it peels now, it will peel later and take any new paint. Then clean the surfaces with soap and water and let dry completely(24-48 hours). Then use a shellac based primer(BIN for interior or BullsEye 123 for exterior, both made by Zinsser) and prime. Then use which ever paint you choose. The best paint jobs are 70% preparation, 25% paint, and 5% technique.