CHECK this out! You can (and in most cases you should, in my expert.ish opinion) wallpaper over wood paneling.
With a few tips from ferm LIVING, Jaime at ShelterPop provides step by step directions to turn old wood paneling into a dream wallpaper surface :) Okay, maybe not quite a dream... but these results are great! It is astonishing what wallpaper liner and some pretty wallpaper can do! Thanks so much, Jaime!