If you are going to that expense, it is worth changing your blinds to a newer option.

Not a fan of verticals myself. I think they look pretty dated now, and to be honest, I think the padded pelmets do too. I'd replace the lot with roller blinds.

padded pelmets are a great option!! They are not out of date given the amount that I do for my clients!!! If you like the verticals do not change them. It looks like there is a considerable gap between the cornice and the top of the verticals, so dont feel compelled to fit the pelmet all the way up to the ceiling. Keep the pelmet about 25cm in depth and make sure the track section of the verticals are covered. Cover them in a plain but textured fabric that wont date and consider a contrast piped edge. They will not make your room look smaller.

Pelmets will come back like everything else eventually does. In saying that I agree about a plain colour with some banding or braid to complement your furnishings. It looks like you love colour so I don't think you need more & I also think your fabric choice would look alright with the existing palette.

I think the pelmets will give a nice, polished finish to your blinds. I would be inclined to choose a neutral/lighter coloured fabric to blend in with walls, blinds and floor rather than a standout fabric which as you mentioned to keep the space light and airy plus allow flexibility to change your furniture/decor down the track if you wanted to. The online store has samples available so I would make good use of this and order a few as I find it hard to judge colours on screen.

If you like padded pelmets you should have padded pelmets. You will be the one looking at them. I had glides only to start with but quickly called back my window dressing lady to put padded pelmets in. I don't regret do it all all. I think it finished off the look.