We put ours on the ceiling because we thought that would be better than cutting holes in the walls and they'd be less noticeable, forgetting that we had fancy ceilings and were doing a ceiling treatment. Thus, by then it was too late to move them, and we ended up spending an obscene amount of money on a decorative cover for the ones in the great room because the white speaker covers looked terrible and apparently there is only ONE source of decorative speaker grills in this world and they capitalize on their monopoly. So... If you have plain ceilings, I'd say they would be more out-of-the-way on the ceiling. If you have fancy ceilings (and I remember you are doing a plaster ceiling on one, right?) I would say walls.

I don't think you should mess with the wall you show in your first picture because it's just gorgeous. On this side, yes, neither of those big things is doing anything good for you. It's hard to say how exactly to do it without seeing the new unit, but I would think specially designed shelving where the lamp is now would work. Here are three possible styles that might work for you. I don't have sources for the first two, but the clever corner shelves on the right are available as below. They all have a slightly Eastern look, don't they? The middle one is just a small hanging wall shelf, but the design might be adapted to create something bigger, I think. I also think the thick shelves in the first picture (which I love) would work well in a narrower size. https://www.amazon.com/Greenco-Corner-Shelves-Walnut-Finish/dp/B01MQGU4LZ/ref=pd_sim_196_4?_encoding=UTF8&pd_rd_i=B01MQGU4LZ&pd_rd_r=3XCFHZ8T2V6T5TG2G9C0&pd_rd_w=n30QC&pd_rd_wg=0jbZF&psc=1&refRID=3XCFHZ8T2V6T5TG2G9C0

Definitely white. Try BM Simply White. Why? Because your floors are great looking. A color that blends so much will detract from them - everything will blend and your whole room will be a yellow bore. Once you get the white in, you can always add punchy accents.

if you are liking BM White Dove, paint the ceiling walls and trim all the same color. no accenting trim color needed.