Not sure how high your ceiling is but you could break up the space above the fireplace ( where your tv will be ) with moulding like in this picture. ( hover arrow over the picture to enlarge ) As far as drapes you could go all the way to the top, or keep the drapes lower to the bottom windows and not put any drapes on the arch windows above.

Building out an over mantel would be the best way to break it up. The width of your fireplace (inside to inside from the moulding) will be how large your TV can be. It really depends on how much your are looking to spend. I do not see a coax plugin for cable, so your best bet might be to get the mantel rebuilt, with an over mantel. That way all of your electronics and components can be worked into the design.

The first photo is an over mantel we did recently for this exact problem. Although her ceiling is not as high as yours.

If it were my living room, I would build it out a bit. I would then put recessed built ins on either side, and do coffered ceilings. Much like the second photo. I would go with more of a farmhouse look though. My house is older than USA though.

Ross

Our great room is similar. Our windows face east. We had the upper windows tinted to reduce the summer sun glare. The larger lower windows we installed Hunter Douglas siluettes. We have a nice parkview so we have them raised during the day. If you want to keep it light & airy go with an opaque sheer across the lower window, wall to wall.

Hi! Looks like you have a lovely area! Here are a few ideas for the mantel:

Decorate with different heights by using candle holders around the tv:
http://deciture.com/shop/decor/7/cain-candle-holders-set-5/

http://deciture.com/shop/decor/9/yellow-ribbed-glass-lantern-candleholders/ (comes in different color)

Some ideas
https://www.houzz.com/photos/104-shore-oaks-mediterranean-living-room-austin-phvw-vp~205892