I also have a window like that in our shower - it may, but doesn't normally get wet from the shower. I have put in a thin venetian blind in white (made from plastic) very cheap, under $5. I am in process of making an puffy austrian blind to hang above the window, for a bit of colour I am making it from a shower curtain). It will be there for looks, I may never pull it down. The venetian gives privacy and blocks the light a certain amount.

I think plantation shutters go with almost any decor. You can have them painted any colour as well, so perhaps you might look at a black or dark grey for some "drama", or another darker colour that will compliment the bathroom. Because your windows are going to be frosted the colour probably won't make much difference to the outside.

depending on the size of the existing vanity it should be possible to have a similar new vanity or a custom unit made to replace the original but a chat with a plumber should be arranged to recommend suitable options and plan a schedule to remove the old and install the new, including any necessary waterproofing or tile repairs..btw careful removal could allow the original sink, taps and even the counter to be saved and recycled into a new vanity that matches the bathroom perfectly with the added option of being able to add different doors or drawers to the cabinet

Looking at the outside, why are the windows in the extension different from the other windows? Is it an aesthetic choice or a pragmatic one? Since the windows are different, why not make them a statement? Do something creative with the glass . There are all kinds of coloured and textured glass. Go talk to your local glassworks. Or investigate stained glass options. You can even paint glass with special paints for a stained glass look. You might be able to find a local glass artist who could design you something stunning. Look on it as an opportunity, not a problem to be fixed. And compare prices. You might find an option you can afford that turns the windows into a wonderful feature. However, if you really want a window covering, I would recommend shutters. We have recently put in plantation shutters in our back sun room. We love them. They changed the whole look of the room for the good, provide absolute control of light and privacy, and are much easier to clean than venetians. You can get them in any colour you want if you pick the right company and they are very cost effective in small areas, but be aware that they measure in place for accurate sizing and the actual shutters are custom made in China. Ours took over 3 months to arrive, due to Covid. Then we had to wait for the installer another week or so. But they were definitely worth the wait. They are hinged so you can open them out to easily clean the window glass, and the shutters themselves just wipe clean.