Yes change the lighting! Recess would be great.
Everything being that bleached color is to matchy and dates your kitchen very much.
You are right to change the things you are planning on.
I would paint the cabinetry. New hardware, the knobs are to small.
Add a backsplash to. All this will layer your kitchen to make it much more attractive.

Do you have room for a island?
More of a table style to keep the room open yet give you some extra counter space.

Yes, change the lighting. After purchasing my house I decided to keep the light cabinets...I did paint the walls a warmer color..I suggest you live with it for awhile before deciding...and after you find a counter top that you love...the cabinets could be stained or painted at that time if need be.

Ps...changing the flooring to a darker color would be less than replacing cabinets. I agree that right now every thing is too much the same...

You're off to a great start, but definitely ditch those lights for recessed, change the cabinet hardware and paint, please paint those cabinets! See you have so many, I'd also consider painting the lower cabinets in a darker color and a lighter color on the top.

we painted these for a client on a tight budget and she now loves her kitchen: http://www.livelaughdecorate.com/2012/08/the-birth-of-new-kitchen-on-budget.html

What a great kitchen. We have maple cabinets and a travertine floor similar to yours. However we have a granite countertop than breaks up the paleness, smokey grey walls and stainless appliances. In saying that I would now consider black. Stainless is popular but shows dirt more and even dents. We have silver toned hardware. We removed a similar cabinet to your above the sink for a more open feel but we had plenty of storage. Also another consideration is paint cabinets in two different colors depending on the style of your home. I love some of the light yellow and vintage green cabinetry that I've seen. Also keeps the kitchen bright. Here in the Pacific Northwest we are all about finding light and brightness esp. during winter. Good luck.

I would take a good look at the condition of the cabinets on the interior. If they are in good shape and still have many years of life left in them, you can certainly keep them - repaint, etc as others are suggesting. Just keep in mind that once you put new granite countertops down it is not easy to replace the cabinets. Will the existing cabinets last as long as the new countertops?
Also consider the flooring. If it is fine and going to stay that's another point in favor of keeping the cabinets. But if the floors are to be replaced it may not make sense to keep the cabinets.
New cabinets would also allow you to possibly remove the bulkhead and get taller cabinets, more storage.

I keep hearing that stainless appliances have about run their course. I'd paint the walls, and then paint the ceiling (after you replace the lights) either a lighter shade up the color chip, or a shade from the living area, to tie the rooms together, as well

Here is a great cabinetry option if you would like to change them out. Italian cabinetry has beautiful options with solid wood doors with many color options. They have the latest technology with soft closing doors and drawers and can give your home a great upgrade.

Thank you all for your great recommendations. The floors are Mexican Tile and will stay for now, but we will change them out at a later date to a darker hand scraped wood that we will also carry into breakfast area and den. We had looked at tearing down the fur down above the cabinets and the row of cabinets over sink. But again at this time we are leaving them. That would mean new crown, ceiling repair work, painting. With our closing date the end of July on this house, moving and our kids starting school Aug 6 (here in the deep south), we don't have time for a major remodel job. The cabinets are solid wood in great condition and are stained a white wash. I am going to add an island. So we are putting in granite, backsplash, new lights, new hardware on cabinets, new appliances. So is Stainless still the way to go? I have painted cabinets in my home now and love them. If I leave the khaki wall color (because the house has been freshly repainted), what are your suggestions for cabinet color, granite color and appliances - stainless or black? Do not worry about the color of the tile for it will be changed later. Thanks so much!

oh and we are changing out the sink to stainless when we do the granite. I was thinking of putting in oil rubbed bronze faucet and cabinet pulls. I also like wrought iron. I have wrought iron fleur de lis pulls on my brownish olive green cabints at my present home. I just like the warmth of oil rubbed bronze vs brushed nickel. Your thoughts please. Thanks

Stainless is a good way to go. I have had black and it is always dusty looking even though you wipe counters down numerous times a day.
What colors are you using?
Help to give a suggestion for a cabinet color.

It's a personal preference, you can't go wrong with either metal choice for hardware.
You are right about sink, undercount when counters are installed. You have done this before and seems successful.

Your'e so welcome. You have great, realistic plans. I too wanted to suggest that the floors be redone but figured there were some budget and time constraints. Good luck and be sure to post the after shots

I would do stainless appliances. I think they will give a more updated look - there are always design dilemmas with people dealing with white or black appliances. I think those are fine in a modern sleek kitchen, but when you are trying to update, I think stainless is the way to go. There have been several discussions with the consensus that stainless is not a trend or on it's way out.
I like the suggestions for white upper dark lower cabinets. My preference would be a light counter - quartz, white granite, marble, whatever you like.

Lyswicker, allow 42" of clearance around the island. It's especially important at the wall oven and microwave. And, there are amazing inserts available for your cabinets, if they don't already have them. Happy moving!

Do you prefer a lighter colored kitchen or a darker colored one? You can save with a lighter color kitchen because you will just have to apply glaze for the cabinets and then a nice backsplash in this pattern http://www.glasstilestore.com/salt-water-pearls-mini-brick-pattern-tile.html

Hey Glass tile, love that tile you posted but the link doesn't work...Can I find it on your profile?

Like the glaze idea. I can glaze over cabinets that have a pickled stain on them?