That thing is a gift from the gods, it's the natural gas valve. You can convert your fireplace to natural gas and get all sorts of beautiful glass to fill it with that looks a million times better then logs burning. We just converted ours, it's clean, easy, and amazingly beautiful. My project is getting rid of the hideous tile surround and converting it to Quartz. See pic from Christmas time.

You could design your new wood surround so that the two sides are actually narrow cabinet doors -- think upscale oak overhead kitchen cabinet without visible hardware -- to access both the knob and a bit of hidden storage space.

You could opt for only adding a mantel (no verticals) and add a cover that would focus attention away from the knob -- such as a stained glass cover.

https://s-media-cache-ak0.pinimg.com/236x/dc/cb/5b/dccb5b6ead5ab3f4c984c2d46751a6a8.jpg

A plumber can move the gas over a few inches, if that would help.