If you skipped adding stone, would your budget then allow for the windows to be replaced (which would be my priority) as that wall is really busy and I’d also remove the peaked section…less is more. Maybe look at inspiration pictures to identify what you like/suits your furniture/decor’s style. It’s hard to recommend without knowning, but hope this helps.

Whatever you do with the fireplace surround, the paneling between the windows should blend in with the wall better so it doesn't draw attention.

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Keep it simple, the windows are enough.

I'd start by Priming/painting out all the dark you have now. the wall color or the trim color.

Leave the mantel and the actual firebox AS IS. That may be all you need to do.

Is their another wall to mount the TV on?

What is wrong with the FP to need a redo

The inside has fire damage and it is not safe to use. I am replacing the old gas fireplace with a wood burning fireplace.

In my area it’s easier to have gas inserts updated than wood burningmake sure you have the right draw for wood fires

The look of your current fireplace is fine. It is the paneling that needs to be removed as it shouldn't be the focal point (the fireplace should be). As others have suggested, keep it simple

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Would suggest you replace the windows if your budget allows. Would also suggest you remove the paneling if possible and replace with new gypsum board. If your budget doesn't allow for that will suggest that you paint the paneling the same color as the adjacent walls to make it stick out less.

Too many shapes in one place. Right now you’ve got rectangles, triangles, semi circles and squares- a lot for the eye to take in. Painting out the paneling will make for a less busy look.