You mean rough to the touch? I hate knotty pine so yes for painting but I think you should probably live with it as is for a bit before doing anything. Painting this is a big job since the knots blled through a regualr paint job and with no idea of your style it is really hard to help. For me the first thing I would remove are all those shelves and then see how the space looks . I love the FP but those shelves just cry out to be either cluttered like they are or removed . If you remove them then the TV could go above the one side lower cabinet and a grat piece of art on the other .

You could choose to paint right away before moving in for the ease of already having everything out. Painting that type of paneling can prove difficult so be prepared to try a few things. White will look fresh. You may also want to move in first and see how you feel about the overall direction of design, for example, if you'll leave the built-in cabinets as-is or possibly paint or stain those as well.

i say paint it, id consider keeping some if you like it,

but the living room entire back wall id paint one color, built ins (if your keeping) included

the entryway id maybe sand and stain a light color, but ultimately depends on your style