I'd probably go small tile- what about penny tile?

I would tile the entire wall because it's so small you can pick more expensive tile. Look for glass mosaic tile that picks up the color of your living room wall color.

I'd stick to a gray (with matching grout) so that you don't compete with your counters, but I think having the tile will make the small space feel maximally snazzy. I'd do it -- a Bil said, you can splurge since it won't add up to much.

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Note: if you're keeping the raised bar, I'm not sure I'd try to tile that little strip of wall above the sink, so you could have a little quartz backsplash cut for just those areas or paint to match the gray.

I agree, I want to keep the Quartz behind the sink so it matches the raised bar but the problem is where to stop it on the left of the sink (like to cut it off where the wall starts) or do I let it run along to the end of the wall as it is now? I'm afraid it will look odd to just stop it. The counter top folks think i should run the quartz backsplash all around the counter tops.