I'm not sure if you can paint it or not. I had a guy do mine at my old house. He went over the entire walls with sheetrock mud and then painted. Didn't work out great. The lines in the paneling eventually started to show through.

But you can put 1/4 inch sheetrock over it without having to take it down. Little bit of work but then you'd have just normal walls to paint any color you want.