Simple fix suggestions needed for damaged plywood paneling

In our laundry room a pet rabbit damaged the paneling in several places:

There are no replacement panels available that I could find. I don't want to tear out and replace all the walls.

Things I've considered:

• adding wainscoting to cover the damage.

• wall papering just the lower 3 feet (it would look like wainscoting)

• painting over the lower 3 feet with light gray paint (it would look like wainscoting).

Any other ideas or suggestions?

[EDIT] I liked the answers but I found a thick wall paper that looked like wainscotting and covered well. I think a get the best results with the least effort:

Time will tell if it lasts.