Have you considered automated shades?

Here is an idea.

KH Window Fashions, Inc. · More Info

selectblinds.com has an assortment of Good Looking roller shades in assorted colors and styles. They come with a shroud to cover the roller parts. Mine look like they were made for my windows. They would look great on these windows. And for very little investment. I love my shades.

If you want more of a homey(cozy, warmth), feeling, I'd go with curtains that just touch the floor. You can also put up the shades.

Drapery panels with a center section to hide the middle bracket. Add blinds or semi-sheer roman shades underneath. Repeat the shade or blind on the upper window if desired.