The only rule I know is to do whatever looks best and for that you need to show us an elevation drawing.

I agree with Renovator. It can work really well or look really weird...this all depends on your house.

I understand and wish I could. However, we completely changed the window schedule with the builder on that side (due to budget issues) and what we had drawn is largely now inaccurate. For instance, I initially had a window above the gas fireplace but have since scrapped this and instead am using the windows on each side of the fireplace.

Here is the plan for that side of the house. I have put an "x" through the parts that I have already removed.

To the left is a screened porch with wood burning fireplace. To the right is the single laundry room window.

The windows should be places as high in the wall as is possible with the room for the header above. That is true regardless of the height of the windows. Windows high in the wall let more light into the room.

It appears that the bottoms of the windows are unusually high and so are the heads. You need to draw the interior elevations of the rooms to see if that is what you want.

The lower level windows appear oddly proportioned and uninspired and don't relate well to the upper level windows. Are they double-hungs with transoms and no mullions/grilles? I think it would be possible to improve the appearance of all of the windows.

Should have mentioned that there are lower built ins on each side of the fireplace. The windows have grills in the upper portion of the window. They are double hung windows.

so what specifically would you do to improve the appearance?

Personally I would probably get rid of the transoms as in my opinion windows that short with a transom look very squatty (?)and unusual.

I'm sitting here looking out at my neighbors side windows on the gable side of their new build. They have a similar situation as you. They used 2 full length windows with eyebrow transoms in their family room and they have a bathroom next to that room which has a smaller rectangle window. The heights of the windows are the same at the top of the square part. (the 2 tall windows then have the transoms above that.) The bath window is shorter than the 2 tall windows. There's a brick chimney stack between the 2 family room windows.

It looks good because the windows are lined up at the top of the squared off part, even with the bath window being shorter (it looks fine.)

I think it would look best to have the tops of the actual windows be at the same height. If you want the family room windows higher - consider transoms again. You could do rectangle transoms for much less than the shaped ones that were on your plans.

The laundry window should not be the same as the others. Let it be small and perhaps square maybe an awning window.

Do you want to be able to open these high windows? If not, they can be simple rectangular fixed windows with mullions.

The 2nd story window above the front door on our house is considerably smaller than our other windows because it is historically accurate for our house's style. In that case it makes a lot of sense. Don't forget how window height can dictate your crown moulding. If your windows are too close to the ceiling you may not be able to use crown which may or may not bother you.