Hi Dusty Hydronic towel rails can be a great alternative to traditional panels in a bathroom. There is a huge range of design and budget options on the market. The main difference between a traditional panel and a hydronic towel rail is the way it projects the heat into the room. A traditional panel is mostly convection (around 20% radiant heat) so the heat is released through the top of the panel up to the ceiling then forced back down the heat the room. A hydronic towel rail will be purely radiant as it doesn't have the vents on top. With regards to to heating up the room is always best to oversized with a towel rail mainly because depending what finish you go with the coatings may affect the heat output and also as soon as you start putting towels on them your blocking the heat, you will end up with nice warm dry towels but not necessarily a warm bathroom. I hope you found this useful :)

Your home is lovely, my thoughts are if you are hesitating about the dado rails, maybe consider turning them into an elegant and timeless feature, by converting them to wainscoting? (I sense from your question that you are not a devotee of the Victorian style :-) I also agree with what the others have mentioned about changing the colours to something more neatural like a shade of grey that you like or a dusty blue, and leaving the lower half white. For a more updated look, you could look at updating the pendant lights to something a little more classic, (to your taste of course) and if budget permits, changing to carpets to perhaps a hardwood floor. All the best, I hope this helped. Ive attached a picture and link to an example. http://www.charmingzebra.com/2011/07/wainscoting-success-sort-of.html

Maybe you could consider a bar fridge that may fit where shelving for microwave is... this could hold your daily used foods and then have your larger fridge in a garage area to hold things less used? http://www.google.com.au/shopping/product/879529927670433319?lsf=seller:9455133,store:5516113429362448143&prds=oid:5429649432223856483&q=bar+fridge&hl=en-au&ei=67UVWMGnIYKR8wWl0ZHQBA&lsft=gclid:CMHmgr2UgtACFdWWvQodHk4MvQ

We recommend a 4 bar heated towel rail, there are also new vertical towel rails for a more modern unique look. https://bathroomwarehouse.com.au/products/thermogroup-straight-round-vertical-single-bar-heated-towel-rail-matte-black?variant=37433864356006&currency=AUD&utm_medium=product_sync&utm_source=google&utm_content=sag_organic&utm_campaign=sag_organic&creative=509193521705&gclid=Cj0KCQjwh_eFBhDZARIsALHjIKeaxD7YRLQXJgYv0Cg9DOBle1hqwt3A-nEW8BqKDonMyS0lVzNDYJMaAkejEALw_wcB