Well will the curtains be custom or readymade? That might help you decide. While some like a rod under the ceiling, I'm not a fan of seeing all that wall space between the top of the window and the rod. So, there is no correct answer, it's a matter of preference or necessity. It should be at least 4" above the window/molding if possible and can go all the way up to the ceiling, or anywhere in between.

I'm not sure how large your room is, but I immediately thought of how much I'd love to wake up and look out at the view. If the bed was facing the 5 windows the morning sun might be too harsh but I'd want them left uncovered, or maybe with sheers that soften the sun but allow the view. You could hide blackout shades under them for those who need a dark room. I don't have window coverings at all in my bedroom and have E/W/S facing windows and sleep just fine. And I am not an early riser. Anyway, if you have room to do it, what about a set up like this? Since the sills are so high off the floor, I'd be sure the bed was tall enough to be able to see the view from the bed.

This one's pretty and it goes almost to the ceiling. In fact, you want to mount them above the window so they come down to just below the top frame. That way you give the illusion of height and also preserve your beautiful sunshine. This is nice. They wall papered the vaulted wall with a paper that is very similar to the valance so it seems continuous and lush. Quite elegant. :-)

@HU-36691265 - Sorry for confusion - I can clearly see the middle windows are separate! it will look great doing inside mount with a single shade for each window! It would also look great outside mounted but you won’t know your options until you find out how much space the header takes for the style of shade you decide on. It might be really tight in space between molding top & soffit on that right window. If you’re needing window treatments for your entire house, it’s worth it to have someone come to your house. @Flo Mangan mentioned Smith and Noble & there are others - Budget Blinds etc. They all have many styles of shade & blinds & are really helpful. You might get a new house discount if you ask& are doing all the windows. @Lorraine Blasetti - Drapes have been discussed at length & don’t work in this situation! The OP prefers drapes too but has wisely moved on! 😊 Blinds also come in fabrics i.e. Silhouettes etc.