How to do open cupboards.

Ikea has Ikea Variera Cover Caps especially for this. Lowes might have something similar. Or try some of those stick on bumpers for plants and things.

Now that you mention it, my kitchen cookbook book cases have the same design. Never noticed until you mentioned it. If I used wooden ones, I'd use a "wax" sticky substance so they could be easily moved, Like you do when you wax thread to sew.

recover with wallpaper

paint your cabinets with a good quality paint and cover the holes with washi tape that matches the paint .. the washi tape is easy to remove or change as often as you like!

Let's address the holes first. If they're not too deep, wood putty can be used and yeah, sanding to make it smooth. I'd recommend sanding the whole cabinet and painting a lighter color. The shelves can be removed and install adjustable shelf brackets so you can have custom shelves and use the space more efficiently. If you want permanent shelves, you can do that too by adding wood brackets. Paint will cover the laminate; the home DIY center will have the best advice about choosing the right kind of paint.

I got peel and stick vinyl flooring to redo my counter tops. You could face the cupboards (without doors) with the vinyl flooring cut to cover the facing. No need to fill holes, wait to set, sand and paint.

All you need is a carpenter's square to get. straight lines.

Fine point pen as marker.

Yard stick or tape measure to, of course, measure.

Sharp scissors or exacto knife to cut.

Patience. It's not really that hard.

Good Luck.