Since the bottom of the windows are the same height, do big cornice valances at the very top at the ceiling level on both windows while hiding the top of the windows. It will give the illusion of the windows being the same height.

You could also mount roman shades at ceiling height above both windows and position the bottom edge of the shades at the same height on the windows. You will be amazed at the difference this makes as it will unify both windows so they look identical in height!

I wouldn't hide the transom window above the window on the right. I would highlight it as a feature of the room. I would install drapery rods at the ceiling for both windows and hang matching side panels. Then I would install some kind of blind inside the casing right at the top of the window on the left and install the same blind inside the casing, just below the transom window on the right. Also, I would paint out the wood on the casing so it's white to match the window or the same colour as the wall. Leaving the casing wood tone draws a big outline around the different sizes. Good luck!