Since really efficient heat is not a priority, you do not need any unit that does that. You did not mention whether you have natural gas that can be piped into your fireplace. If you do, the obvious answer for you is to get a VENTED gas logs unit. Stay away from unvented because they adversely affect indoor air quality and are illegal in some building codes. In my opinion, they should be illegal everywhere. If you haven't done so, you should have a certified chimney sweep clean you chimney and ask him to comment on its condition, to make sure it will work when you use it. If you do not have access to gas, ask the chimney sweep to make recommendations on how to use your fireplace.

Whatever you use around the sides and top of the fireplace, you can use on the riser. I took out the raised hearth for my fireplace and used a tile surround. I also tiled the area in front of the fireplace with the same tile as the surround. I believe that you need at least 16" of non-combustible material in front of the firebox. Here is a link that might be useful: some examples of fireplaces with risers

I'm not sure how board and batten will work with your wonderful rough plaster. B&B (or flat-panel wainscot) is really more consistent with colonial, shaker, or arts-and-crafts/craftsman house styles. Your home, from what little the pictures show, is more storybook or English cottage style. Are those coved ceilings in the living room? Keep the wainscot in the bathroom, but don't spread it into the rest of the house -- it won't work. The fireplace is wonderful and unusual. I agree with the others that a heavier mantel shelf set it off beautifully. You have a charming home as it is. Play up its character rather than trying to turn it into something it isn't.

To my eye the fireplace does not have attractive proportions. The hearth is too wide and and overly deep for its height, the wood box is too small, the ceiling trim too bulky, mantle too large and too high. And the doorway looks squashed in beside it. No amount of whitewashing or painting is is going to change any of that. The good news is that it looks like the stone isn't boulders stacked up like some of the photos people have posted above. I think it's rock veneer, flat pieces of rock stuck to a cement/wire mesh base. If it's veneer, you should be able to see that from the side. Can you stand by the round mirror and take a picture for us? Veneer can be removed relatively easily by someone with experience and the right tools. Then you can have the room you want. You can shorten the hearth and put the TV to the left of the fireplace which would look much better than above it. Now is the time to do it, when you're re-doing the floor. If not, be sure to keep a box of the flooring for later if you want to remove or shorten the hearth and need to fill in the floor. My house also had an overpowering stone fireplace and the best thing we ever did was replace it with a normally-proportioned fireplace surround. IMO these large stone fireplace walls look great in big chalet-style homes with high ceilings, and are out of place in regular homes.