Regarding wainscoting - I'd consider how you plan to use the space. If it's a playroom/family room and kids, tweens & teens will be using it often I'd go with it in a semigloss finish to protect your walls & paint job. Yes, it's more work (& will add to the construction cost) but in the long run it will look nicer for much longer.

I also think it will add light to the room and make it feel less like a basement. There is a way to work it in with the cubby design. Re those, I'd go with 2 shelves to give you more flexibility with storage & display.

Those cubbies are really deep. Are you planning to use baskets or are you just going to throw things in the cubbies. I would base the shelves on what you plant to store in them.

amck2- Thank you, I also think the wainscoting will add a lot.

beverlyfla- Yes, they are very deep. Since we don't have a mudroom I really planned on storing shoes in the bottom Cubby. I wasn't planning on having separate cubes like your photo above, although that looks nice. I just thought I would have a fixed shelf (or shelves). I figure we can store multiple shoes behind each other and i was thinking of using baskets for the top shelf to store hats and gloves, etc.. Do you think the separate cubes would look better?

If the cubbies had been restricted to 12" in depth you might have had a chance at organization, but with them being so very deep, once you put the multiple shelves in the cubbies, no one will be able to see what is in the back of the cube to find what they're looking for.

beverlyfla- True, maybe I can store out of season shoes in the back of the shelf?

From what I can see of the ceiling height, wainscoting will make the ceilings look and feel lower, so I would not do it. Additionally, the area is not very spacious for all that's going on already---- soffits, columns, etc.. If you really want the wainscoting I'd get rid of the cubbies, as their appearance and use are contraindicated in a room with wainscoting.

Paint color.....pick the lightest one in your palette and then go two or three shades lighter.

I would put 2 shelves in each of them... and have the lower of the 2 shelves in the bottom section higher for higher topped shoes and boots. I think it's a great idea to get plastic shoe boxes and store out of season shoes in the back! I wouldn't separate into cubbies because that limits the use of them.

I would use baskets on the top shelves and probably space the 2 shelves so that different ht baskets could be used on the shelves...

I think I like the 2 colors better on the right and would probably not get wainscoting in the entry, but definitely paint it in at least a satin finish so it can be wiped more easily--- flat paint in high use areas just doesn't work out well, ime!!

With the lower ceilings, the soffit in the way, the beams and the short windows, I would skip the wainscoting as it will bring the ceiling down. It's hard to tell from the pictures, but if there is a natural break all around, you could select one color and go a shade darker in the hallway and a shade lighter in the room and put the lightest shade on the ceiling. For example, BM hemlock in the hallway, BM paradiso in the room, and BM in your eyes on the ceiling.

Our old basement had the same ceiling height of 7' with more columns. Similar soffit and we had wainscoting. I realize the configuration of the room was different but thought it looked nice.