I would tile it. The butler's area needs to be treated as a unit, not interrupted by something around the corner. Respect the symmetry!

I would also not pay for a finished panel on the side of the pantry that I'd be tiling. :)

I agree with Fori... no need to pay the upcharge for the finished panel on the pantry, Tile that area the same as you intend over the butler's area.

I'm curious about how that upper cabinet will be installed. Is it going to hang from the side of the pantry cabinet?

the bigger issue for me would be the 3 fronts composing the pantry door...they don't correspond or tie into the sides of cabinets on the right [kitchen side]..... I would pay for a side panel to run down the end of top and base cabinets...same configuration of sections as the pantry. You would be closing in the end of run that you are discussing......much better. ... at install time ,be careful with lining the pantry up to be flush with the side panel next to it.... which would be easy....at the floor as well ....use a wall cabinet instead of standard base cabinet...allows gap to tie in at the base of pantry......couldn't she get a set back furniture toe kick wrapped around it all rather than what is shown, where the pantry and base cabinet don't match at floor.....I would really work on this as you have the nice leg and open area left of sink [is that for a couple stools?]...draws the eye and then seeing the mismatch at the end of run beyond it....you can get it better I think.

That area appears like a single piece of furniture in a challenging to design configuration. So it would benefit from some custom cabinetry design ideas that integrate the two.Outside corner cabinetry

This is a minimum.