if you want this job to be right what i would do is first cover the paneling with a primer stain killer such as bullseye 123(latex based)one coat.then any spaces between the panel sheets fill with paintable caulk,smooth it down well.then paint with latex based paint the color of your choice(i recommend behr).when you put your primer on the primer is going to look blotchy but don't worry the paint will look great.if you don't use primer the paint will scrape off with a fingernail.use a brush and roller.