I would do floor length drapes.

Here's a rough mock-up of how it would look, I also added a dresser under the window:

There's no rule that says that the window treatment has to be the same length as the window. Depending on what you have under the window, you can go a little bit under the sill, to improve the proportion, or full length.

Where will the bed sit in the room?

You could do a cornice box above each window -- just make sure that the bottom of the box covers the very top of the window (including the moldings)

A cornice box (a wood box that is generally painted to match the wall color in the room or it could be covered with fabric) OR even add a fabric valance will create the visual illusion of a "taller" window. And the taller windows will make the whole room appear taller to the veiwer's eye.

Then add blinds (maybe matchstick ones) that hang over the bottom of the window and curtain panels that flow to the floor.

As shown above -- add the bed OR a desk OR a chest of drawers under the windows.

Also -- if you add a chandelier to the ceiling -- again -- you draw the viewer's eye up -- and help create that "taller" room illusion.

I've included an example (JUST an example) of a room with striped curtains and a fabric valance ...

Here is a link that might be useful: Phoebe Howard -- just an example to show how valances and a striped fabric make the whole room

I have two bedrooms with similar wide, short windows. I intend to use floor length drapes, which I have used throughout the rest of the house (in different materials). I have also considered using roman blinds. I think either or both together look great. What kind of draperies do you use throughout the rest of the house?

Thanks for the input. I hadn't even considered floor length drapes, but I like how it looks in the examples.

The bed will be centered under the other window. Probably a desk under the window you all mocked up.

Pricklypearcactus, at this point there are no draperies throughout the rest of the house. I have a lot to figure out. The rest of the house is dominated by a number of sliding glass doors, which are a whole other issue.

I too have a sliding glass door. I used a washable (outdoor fabric actually) set of drapes with grommets that slide easily on the pole. The grommets allow the drapes to slide open and closed easily. The material is kind of a canvas-like off-white. I wanted something light colored, but in a washable material that dogs and men with greasy grill fingers couldn't ruin. We use our sliding door a the main access to our back yard and with a dog and during nice weather, we're constantly opening and closing the door and sometimes the drapes.

That sounds like a great idea for the slider in our family room. The other 2 sliders are in the dining room and our recently redone kitchen, so they'll need to be a bit more "dressy" than a canvas-like fabric (though not overly formal). I like the words "washable material."

I would use some type of treatment such as a roman or cellular shade so you can get the light control and privacy. Just depends on your taste. If you wanted to dress it up more add a top treatment. Either a cornice which will most likly have to be custom made or a softer cloth valance on a rod.

These windows provide more privacy, but can be a problem to decorate. Shutters would be a good solution here.

In formal areas where you're not constantly letting dogs in and out, a more format drape would be fine. You could use either grommet top or ring top to get the easy sliding functionality. I have ring top silk drapes in the more formal areas of my home. The rings are a little noisy when you slide them open and closed, but they slide almost as easily as the grommets. (They're just a little heavier to pull open and closed.)

In any case, I didn't mean you had to match drapes throughout the house. I like the style of floor length drapes and so I've decided to use them throughout the house.

Valinsy, I like those white wood blinds. I'm thinking that the blinds alone could be a good solution in the guest room and office, and I can spend my time playing around with the master bedroom.

I think the white wood blinds are a great place to start--esp. as you say you've just purchased the home and probably have many things to work on. It gives you time to develop your style and decor room by room and the flexibility to change as your life may change.

The blinds alone do look best if there are casings on the windows which it looks like you have. That is how I have in my home office.

The kids' bedrooms do not have the casings on the windows so do look a little under dressed with just the wood blinds. I found this work in progress picture of my DD's room before I had put up a valance. While I prefer panels, due to the size of the room and furniture placement it wasn't possible:

I bought my blinds from JC Penney's during on of their 40% off sales. Lowes also sells them as well as do other places.

We had very similar windows in our old house and we used wood blinds.