I'd probably use a bold design on one feature wall, especially if the pattern of blue peel and stick wallpaper has strong graphics or a large mural composition. That gives the room personality without making the entire space visually busy, and it also leaves plenty of freedom for posters, shelves, lighting and other things that teenagers tend to add over time. For a calmer design, covering more walls can work nicely, particularly with minimalist or neutral patterns. I think the decision really comes down to how intense the artwork is and how much else is already happening in the room.