Wood blinds are a great choice. They can be raised or lowered, and the slats can be angled to allow as much light in as you like. I'd match them to your trim and mount them outside the frame to avoid light strike on the sides.
The arch window is another story. These windows are difficult to treat if you want to stay within the shape of the arch--the treatment will need to be custom made. Or you can cover it with the same treatment as the bottom part, and mount it above the top. We've had a couple of these type of windows in the past, and found the best option is to replace them with rectangular transoms.
Q