Lovely room.

What you posted in the second picture would look nice. But I would ask what your concerns are for the window area & room? In other words, I have a similar window in my living room (deeper seat area though). My living room faces west and the afternoon sun is brutal. This window also faces the street, and privacy is a concern. I also like a lot of light.

I looked at all options and purchased bottom-up/top-down shades. I NEVER use the top down option, leaving the shades at the bottom 1/3 at all times for privacy from the street. However, when the sun is setting I can pull them up to block the sun, then releasing them back down after it is dark. It appears you have crank style openers at the bottom of each window. I have the same on either side (my middle window doesn't open). These shades don't get in the way of the cranks, I keep them held in place by the string mechanisms just above that level. I had these blinds custom sized, I believe by JC Penney (but I am not certain). I have one for each window so they can be operated separately.

If you don't want the shades, you could do cafe curtains across the bottom 1/3 of each window with springrods if there are separate "sills" on the sides of each window, or one long one, if privacy is a concern. If not, then the picture you posted would work, and the shades would be attached at the top of each window space. Due to the minimal width of each window, these will have to be customized. You can then pull the drapes for more darkness so the light doesn't shine on the tv during viewing.

Good luck and enjoy your process!

I put a window in like this about 10 years ago.
It faces South. We had a bumped out box of the outside of the house. The ox is 18" deep. I installed a Marvin wood window. 6' x 4'. The window seat is oak with a hinged lid. We use it to store folding chairs.
Drawback:
All wood exterior even with epoxy finish does not hold up.
Window should be lad exterior.
Overall it has been excellent
The house is 88 years old

Pretty window! Have you thought about stained or leaded glass for the window? Its a great way to keep the natural light and have privacy. Below are a few examples. Please let me know if you would like more info: 1-866-846-5758. Thank you!