Put your backsplash only from the right of the sink to the left of the refrigerator.

Mirror the bulkhead.

What Melissa said.

The brown piece has paneling to the left of it (and into the living room), no paneling to the right (in kitchen). This was where the old countertop ended. There is about 3/16 difference, so even if we remove it there has to be some kind of transition piece (not looking to remove all of the paneling in the neighboring room at this time).

In my opinion, the wood trim has to go. I would recommend replacing it with a metal Schluter trim or tile trim piece. Then bring the subway tile over to the new trim and all the way up to the ceiling. This will create a vertical design element. The curtain rod would be an issue if you went any further. If the subway tile is white, I would also recommend grey grout to make the design pop.

Remove trim piece and forget back splash altogether. Just use semi gloss paint and repaint as needed. Put large poster or painting on wall where trim piece is now. Perhaps paint a slightly different color on backsplash and wall.

jbtanyderi Can you please explain "mirror the bulkhead"? I'm not sure I understand.

I'm not seeing your paneling.

Why is your curtain rod over that far? Do you actually have drapes for it because they will be over your counter top.

This is all just jumbled up. Maybe you should have someone look at the wall and figure it all out before you tile and I personally think if you tile up that wall it will not look good. Your kitchen stops at your cabinets. There's no other wall that you can tile up so it would just be that one spot and look really odd/ out of place imo

Why don't you just bite the bullet and get rid of the paneling? Then worry about the kitchen...

How about just removing all of the paneling on that one entire wall for now? You can always remove the remaining three walls' worth at a later date.

Thanks everyone. We're thinking grey grout, so I'm glad to hear that as a recommendation! Had thought about the curtain rod issue, but think it might be worth it to cut tile around the curtain rod piece since the bigger eyesore is that brown trim.

I'm not seeing your paneling.

Here you go:

IF I did a backsplash in your kitchen ( mine is similarly laid out, I didn't ), I would just do the stove / oven wall, from the corner to the refrigerator. I d paint all the same for a seamless look & save my money to do new flooring, all the same product.

Oh god no, do not tile around the curtain rod. That will look even worse.

I like the other posters idea of removing paneling from the one wall and deal with the rest later...

remove trim, repair wall, backsplash tile should stop even with/under the upper cabinet.

i cannot see any paneling, if it has been removed don't replace it on that wall, stop in the corner to the left.

You can't just do one half of a kitchen backsplash or the one wall over the stove. That looks like you ran out of money to finish the other wall, or something.

Ditto ninigret :-)

The paneling is painted. You can see it in the third picture I posted above. The old countertop ended at the brown trim, so the curtains were not over the old countertop. I'm not opposed to repositioning those types of things since the new countertop is extended. I think my biggest question is, if I tile floor to ceiling in this section, would it look good, or am I missing something and it would really look off?

Or, if you absolutely can't remove the paneling I agree with Daniel to replace that brown trim with tile trim and only then I would bring over the subway tile to the wall and I would NOT use grey grout because it will make it stand out even more. I would only use the white grout. I don't think this is a design issue you want to highlight and grey grout will highlight it. That trim isn't even finished at the bottom and I still don't see what the paneling looks like on your walls and you should fix the curtain rod issue too.

Maybe somebody could photoshop both tile options white vs grey grout and taking it up the whole wall. Then you will get an idea. Or just get an experienced tile guy in to give you ideas/estimates to finish it professionally. Putting in subway tile backsplash is not hard but you want this to look good, not a jumbled up mess, right?

Go with the first advice given by jbtanyderi. My niece had a professional design team renovate and refurbish a 150 year old stone farmhouse in Ontario, and they placed the kitchen backsplash in one area only. Her large kitchen sink sits beneath a window. The backsplash is to the right of the window beneath cupboards.

Sorry comas but not in this kitchen
It would look unfinished.

I would agree with Melissa, don't cut around the curtain rod !Shrink or eliminate it. If you feel the tile needs to extend out to the edge of the counter or beyond, cut back the paneling just a little past the edge and go floor to ceiling. The cabinets look modern, so be bold and go with a modern design !

Thanks, again, everyone. Sounds like cutting around the curtain rod is a bad idea. Got it. :) I appreciate everyone's input!

After thinking this over all day yesterday I was sure I would play it safe and end the backsplash at the upper cabinets. But then I came right back to my thought that because the upper cabs don't stretch over the peninsula, I worry it's going to cut the backsplash off way too early. I like the idea of stretching it to the end of the counter and going up to the ceiling. If I keep it above the counter (not going to the floor) does that seem like a better fit?

no. i find the tile would be visually heavy sitting on top of the counter. its a variant of this: i prefer the orange arrow side.

if the counter wasnt sticking out, i'd agree with you to do the whole wall, but i think tiling above and below the counter would look off.

That explanation is helpful, ninigret. Thanks!

I believe what is meant by "mirror the bulkhead" is this: the bulkhead is that built out soffit over your cabs. Mirror it by placing tile where the bulkhead is and don't place tile if the bulkhead isn't above it. Kind of clumsy explanation, I hope it is clear. I think I agree with that solution.

Tile the soffit?

Maybe if your kitchen looks like this, but this one doesn't.

Ah, I see, jeanetteburgess! That makes sense, thanks!

This crossed my mind, Melissa G! Is this part of the hesitation for tiling the wall to the ceiling? The height of the tiles wouldn't match the rest of the room (unless the soffit is tiled, as you mentioned)?

No, In a kitchen with a soffit over the cabinets I have never seen it tiled.

The most logical place to end your tile is to bring it in line with where your upper cabinets end and go no further.

Look at photos of kitchen here on Houzz and then maybe you will see....

It seems like your trying to "fix" this issue with the wall by tiling it all the way up and over by the molding. I just think it will never look right, but that is only my opinion.....I would put my money on fixing the wall first because honestly it doesn't look good. Not trying to be mean. Just my honest opinion.

Seriously, though maybe you should get an expert tile person in to advise you.

Thanks, Melissa. Good point on the tiling soffits w/o cabinets.

I don't think this is a wall fix issue for me. We took the paneling off to the door today and I know we can get it fixed up without the tile. Maybe it's more of a personal preference? I see something like this and think, that looks awesome!
http://biggerthanthethreeofus.com/wp-content/uploads/2016/11/This-DIY-kitchen-is-jam-packed-with-ideas-DIY-Open-shelves-tiling-and-more-Click-over-to-see-the-rest-1-2.jpg

When I see pics of the tile ending at the upper cabs and there aren't any cabinets over the peninsula (as in my case), it feels like the bar stools/counter are in a different room. And as I've heard, the backsplash ends the kitchen... but I still have a peninsula that I want to be in the kitchen! :) I don't want to do something that looks wrong to everyone that sees it, so I feel like I must be missing something? I will say, extending the backsplash to the edge of the counter and NOT going to the ceiling does look off to me. Just thought the ceiling as a stopping point would give a different feel.

Why don't you put some artwork up there on that wall?

I like that photo you showed but that is not what your kitchen looks like. You don't have walls with open shelving.

Now, if you wanted to put up a couple of shelves and tile behind those? .....hmmm....that may be an idea??? But it would probably just be for decorative things vs dish ware and stuff you use everyday.

I understand what you mean about wanting it to be "in the kitchen" ....

What do other people think????

Any thoughts??? (Glad you got the paneling off )

I agree that there is no reason to extend a backsplash the entire length of that wall in question. Definitely do not tile up the wall. It seems that you are trying to design a backsplash to camouflage a wall that needs to be repaired first... remove the paneling that butts up against that brown trim. Remove the curtain rod and get the wall of the door flush with the wall of the kitchen sink.
If it is so challenging, I would truly forgo the tile backsplash, disguise the change in the wall by placing a large framed art in the space to align vertically with where the trim is now. It seems to be the old lipstick on a pig syndrome that you can't fix. Sorry.

That's what I said in the beginning....

Fix the wall.....and don't tile anything until your walls are properly level and skim coated.

I like your inspiration pictures but you don't have that type of kitchen and no one is going to look at your counter bar and think it's not "in the kitchen" ...you'll have bar stools there, I'm assuming.

If you don't fix the wall, THATS what they'll be looking at! I guarantee it.

Hire a really, really good sheetrock guy (not a carpenter) to fix the wall and bring it in line with the paneling. Then mirror the bulkhead (as above, let the footprint of the bulkhead decide where the tile stops). If you were to tile all the way to the ceiling, any good tile installer would take out the sheetrock and replace it with cement backer board, anyway. A good installer makes sure everything is plumb and level before he or she starts. That's what you need there. If you need a reference, call a local building supply (not a big box store). They know their customers and know what kind of work they do. If you need a reference for a tile installer, call a local tile store, they'll usually give out names.

I called a local dry wall supplier in my area and he gave me the names of 2 good drywall men. This is all they do. Agree with Carolina...that's who you need...

Also, if you want to do white subway tile eventually then I would paint my window and door trim white. It will look better, especially over your sink. Just a thought...

Thanks, again. These are some good things to consider.

If you are still undecided the tile can wait and be done later. As others have suggested just get the wall fixed then live with it for a while.

1. I see there is going to be a slight difference in wall that you can put a half corner in the wall that has the paneling and continue the finishing in the wall without the paneling. Backslash only under the top cabinets.
2. To be prefect you should install dry wall on the lower leveled wall, all the way from where the trim starts to were the top cabinets start. That way you would fix the problem with the wall that is paneled, and also do a perfect finishing regarding the backslash, the entire wall would be consistent and leveled all the way through.