I have no idea we need to see the sofa at least IMO pallet pieces need to be made impeccably or they look like garbage so if that is what you are capable of then maybebut not all matching for sure .What colors do you like ? We have no info from you so can’t help

I'm with Patricia. Not enough information to assist. We need to see the furniture and accents that will be moved in. I would hold off on paint, until you decided on all the main color scheme and elements. You say you already repainted the kitchen. We need to see the color you chose, because this might influence the connected living room.

Just throwing some ideas your way, but have you thought about doing an accent wall with pallets? You could leave it rustic with different colors and lengths(cause all pallets are different) or you could sand them down and stain them.(Just be aware that your using pallets that are safe cause some have a toxic coatings on them)

Also a brown/tan tone paint color or even a gray tone paint color as well I think would look nice.

Unfortunately you cant do too much to the ceilings cause they are so low:(

Hope I was some help. Good luck on your living room project!