Getting a smooth finish like drywall will be very tough. Here is what I did. Be sure to get the paneling clean and oil free. I used TSP and scoured it before I started. I filled the grooves in the paneling with drywall mud and sanded smooth. Next I covered the wall with “underlayment” paper. Underlayment paper is a wallpaper to be used under wallpaper. I hung this horizontally. Next I hung textured wallcovering which is paintable. I hung this vertically so the seams would not match up underlayment. I then painted the textured wallcovering (It’s made to be painted). This gave the appearance of an old italian plastered wall. I did this 7 years ago and it has held up well. Be sure to nail any loose spots in the paneling before you start. Good luck.