Hi Cathy, paint is always an option. Here's a tutorial for filling in the grooves to make it look like sheet rock: https://www.todayshomeowner.com/video/how-to-fill-grooves-in-paneling-before-painting/
It an be cleaned with Murphy's Oil Soap. Or primed and then painted. It looks great painted with the grooves left alone or filled.
Ignore that it is paneling and find a paint color you love. Follow prep for painting paneling and the results will be stunning.
I'm with grandma, you could fill in the grooves and paint it or you could put 1/4" sheetrock over it, then plaster, sand and paint.