No cabinet. It's a waste of countertop space and if you're doing open concept commit to it.

As for the island, if you're selling the home just keep it the same color as the rest of the cabinets. If you're renovating to sell (which is risky BTW) appeal to the widest pool of buyers.

I like the cabinet as separation.

Both look fantastic. I think if you can work with the pantry... go for it! Great selling feature and you can never have enough food storage. Enjoy! That's a beautiful kitchen.

I prefer the open look. However, a shorter cabinet ( maybe 56" tall), (with glass doors) can successfully divide the rooms and maintain the airy feeling.

I would prefer a transition that is not so deep to the right into the family. It looks heavy.

Both options look great!

The layout including the tall cabinet creates a balance of the mass of the refrigerator and helps to define two separate spaces. If you'd prefer a more open-concept feel between the spaces, the layout without the cabinet is a more conducive plan.

When painting the island, keep with the neutrals. While navy would look excellent, it's a little more limiting of a color. A prospective buyer may not be able to look past it when trying to envision personalizing their new space. Consider, rather, adding navy in in the furnishings and accessories.

Best of luck with your project!