Are you going t make one level surface for the tv part?

I'd install a false back making the upper part about 12" deep, or less.

I'd work on painting the cabinets with either General Finishes Milk Paint which is a latex paint, "called a milk paint" and very user friendly. Annie Sloan Chalk Paint would be my other option to paint the cabinets and update the knobs.

Many tutorials on You Tube about this. I'd make the cabinets interesting since a TV is going on the wall which if my husband lived there would me the majority of the wall. If you go with wallpaper which isn't a bad idea. It would have to be very muted/minimal as the TV will be there so I wouldn't put wallpaper in that area myself.

I guess the best question for me would be is the TV going to take up the majority of the wall space?

I think shiplap or barnboard would look good.

I bought vinyl sticky board flooring from lowes and used it for the back of my entertainment unit. I still want to go back and do it on the back of the glass cabinets... where I'm from it's cheaper and easier to get the fake stuff than real barnboard.