I recently solved a similar problem by building a custom upholstered valance box. The total cost was around $75, including the matching curtain panel used for the upholstery fabric.
First, measure the window, and figure out the dimensions you need to cover. A 2-3 inches overlap on each side should be enough.
Next, cut 1/4" plywood to shape, and make a frame out of 1x2's. (Note the dimensions of the window drawn onto the plywood for reference.) I ended up doing a framed design - an outer section with a cutout inset.
Determine where you want to place the buttons. You'll actually screw through the inset panel to mount it to the outer frame after you've upholstered it. You can hot-glue the buttons on afterwards to hide the screws. I almost forgot to mention - you'll need fabric covered button kits to make the buttons match. You can get them at Walmart for about $1 each.
Time for upholstering! Buy an electric staple gun for this. I ended up using about 1200 staples. Three layers of batting and one layer of fabric later, your hands will thank you for spending $30.
You'll probably want to finish the back with a white fabric so it doesn't look like crap from outside. I used the leftover liner from the blackout curtain panel used to upholster the valance box. (I also added a screw in the middle for a support wire for the flimsy $3 Walmart curtain rod - it was designed to have a center support, but the window shape didn't allow for it.)
Install the valance box using metal brackets and wall anchors (or preferably screwing to studs if they're in the right location).
- Cordless drill/screwdriver
- Electric stapler
- 18 ga. pneumatic brad nailer
- Hot glue gun