Pretty room! I think floor to ceiling panels would look pretty in this room. You can treat the corner window as one. I would place a panel at either end and one at the corner. I have added a link to Country Curtains to show you that there are corner unit accessories for rod hardware to achieve this.

Here is a link that might be useful: Country Curtains

Pretty view....I would go with just a valance that goes around the corner and if you need shades for privacy, get some silhouettes that hide under the valance during the day. If you like the look of sheers, then you can do dummy side panels and sheers just for the effect.