I would do a glass splash back [ this can be painted in your color choice to suit the decor ] - taking from the bench top up to the bottom of the range-hood on the wall of the stove. The window is beautiful and I would give anything to have them in my kitchen. I would probably paint OR stain and apply marine grade vanish to the would so that any moisture would not be able to ruin the wood. I would also put herbs or flowers there. Could it be made into a servery for outside maybe ???

You have some good ideas but if you're going to sell soon and aren't planning on taking the soffit out, I would just do some minor changes and keep the cabinets (just add a couple cabinets). I wouldn't move the sink but just get a nice stainless steel sink and update faucet. I'd get a stainless stove vent. Remove the wall on the left of the refrigerator but then just do a small pull out pantry on the right of the refrigerator. And, put a cabinet above the refrigerator and make it look built in. A glass backsplash, can lights on the ceiling and pendants above the penninsula. I think a raised counter will make the kitchen/room feel smaller.

I would suggest you take out the cabinet that is to the right of the stove and use it elsewhere in the house -- perhaps in the bathroom or dining room with a hutch above it. Then, I would suggest you have someone install a lazy susan cabinet in the corner between the sink counter and the stove, meaning you would move the stove down a bit and have a small cabinet/counter top to the right of the stove. I would suggest you have the cabinets refinished in white and then paint the walls a pastel you like. If you would prefer white walls, then add white-painted crown molding and paint the ceiling a light neutral blue, such as Sherwin Williams Niagara Falls Blue. Then, I would suggest you choose a favorite accent color and use this sparingly in accessories like towels, pot holders, small vases or floral arrangements, and a valence above the triple windows. For a genuine 1940s look, you might have white ceramic square tiles with a rectangular red border installed as a back splash behind and above the stove. If you are replacing counter tops, I would suggest a light color such as white with a beige or light grey vein or striation for some sort of pattern. You might be able to find the same color and design in floor tile OR opt for a wood floor as another poster suggested.

Beautiful clean modern kitchen! You have a great opportunity to put your personal stamp on the space with a unique backsplash. As you've heard already there are some different approaches. I'd probably place the backsplash up to the wall cabinets and up to the base of the hood. Then continue the backsplash at the same height (18"?) behind the sink. Then place an inspiring colorful picture above the sink to break up the wall. Here's a picture with pendants that aren't too obtrusive. Having multiple levels of lighting at different lumens makes a more inviting feel to the space. I couldn't decipher your flooring, but you may also want to consider adding some nature elements like a type of wood flooring, wood stools, etc. Good luck! If you need software to plan out materials check out our Home Designer software: http://www.homedesignersoftware.com/