I wouldn’t paint it unless you intend to paint all the paneling as well. It looks like that would interfere with the door swing. Have you lived there long enough to be certain you don’t want to remove it?

Hang some art - I am certain the door swings the other way, out into a hallway.

HAHAHAHAH So they lift it out? It certainly meets no code in entirety, as an in swing to the stair allows no reach of the handrail.

I'd be more worried on the safety and LESS on a pretty descent to??

We're designers, not magicians. If the shelves stay, the bump-out stays. There's nothing you can do with this.

Door swings out the other way. There is another entrance to the basement. And this house was built in the 1960’s and the built ins were prob added in the 1980’s. We inherited the house and some things are just as they are.

Okay : ) @ Millworkman can eat some words now, he deleted his post, I think.

Hang some art and move on. It's not a big thing. It's dictated by shelves you like, that we can't see. Life and houses are choices.

Based on one photo and very little info, here are a couple of ideas which are focused on low profile updates to help keep the stairway open:

1. Since the bump out is smooth, you could add wallpaper that looks like art and use low profile trim to frame around it.

2. A low profile knob/lever for the storage cubby door on the right side.

3. It looks like you may have a bare bulb for light - an attractive wall sconce with bright bulbs will help, you may want to consider adding other lights too.

4. If the stairs are traveled frequently and the basement is finished, swapping the door out for one with glass will let light in and give a glimpse of the wallpaper/art.

Rather than calling attention to the bump out by hanging art on it , perhaps add a focal point at the bottom of the stairs to draw attention away from it on the way down. Do people often stand at the bottom and look up? If this entrance IS the primary one, then a prettier door at the top (reeded or etched glass in the top half?) might draw the eye past the bump out.
Good luck!