Leave it empty?

I don't see a railing at the top of the stair shown in your first photo?

Ignore it. It’s too high to put any decor, you won’t be able to see it.

No need to decorate it-best left empty.

Remove the entire closet including shelf and you will have a bigger entry.

If you are doing some other Reno’s, remove the flooring on it and drywall it. I think if you then painted it out the same colour as the surrounding walls it would disappear more.

I think the idea of removing that closet and that shelf might be agreat idea but what is behind the closet if there is space behind then a bigger entry and still able to have a closet . Other than htat just ignoe that sillty thing done bacuse someone oops design