Wow, that lighting fixture is not good. I'm sorry, you said you just bought it, but it doesn't look good. Anyway, to stick to the question about art. Yes, you need art. And no, you don't hang it way up on the drywall area. You hang it normal eye level so that part of it would be on dry wall and part of it would be covering up some of that wainscoting. In a more perfect world, you remove that wainscoting. If that's not possible, then I would at least fix your paint issues. There is too much contrast between that stark white and that darker orange-ey brown color. I would paint the dry wall a lighter color, and the wainscoting a dark color, and try to get them closer together on the contrast scale. Remove the little sign with the wording on it.

OK a couple of suggestions

No plaques with sayings. Signs might be used in a kitchen but not a dining room.

The rug is way too small for your table. I don't think the room needs a rug

Give your table a quarter turn so your chairs are in line with the corners of the room. The table looks a bit small for the room so turning the table will make it more interesting.

A dining room needs a bit of sparkle and I think it was a mistake to place those bulbs in the West Elm fixture, and I'm guessing you bought the small size fixture. You should have ordered the large size fixture and installed Globe bulbs for sparkle.

The lights should set a mood, not be so bright that you can perform surgery on the table. See images below for an example

Your wainscotting doesn't look detailed enough. See image below.

If you can't change out the fixture at least change the bulbs to these long bulbs to add more size to the fixture.

Maybe textured wallpaper?

Here are some ideas that might help. We think another light fixture might work better and a bigger rug.

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No "Gather" please. Move to kitchen.

You're right. Wainscoting makes the art too high. Go lower.

Also, the color of the room is disturbing. Not in a good way.

IMO, that wainscot dwarfs that table and chairs. it looks like a doll house table. I don't mind the light, but honestly, you need a larger table for that spot. You have tall ceilings and the tall wainscot just emphasizes the fact. any way you could do coffered ceiling?

This would give some visual interest and bring down the ceiling a bit.

doing more detail on the wainscot like Beverly mentioned is also a good idea.

if you did a shelf on the top, you could do pics like this

Notice the ceiling on this one.