Go down to Kent or drop by Chester Dawe (no relation) and pick up some of the beaded pine in the 8' lengths. It comes in a package that covers about 14 sq foot and sells for around 12.00 each. Make sure that you have a good look at what you are buying - pay particular attention the edges to make sure there are as few knots as possible.
Next buy some Zinsser stain kiler - it is a shellac-based product that is pigmented white. Two coats of this will prevent any fresh knots from bleeding through your paint. Then paint as required.
I used this pine on my ceilings and some wainscotting in the bathroom and as the doors in my kitchen cabinets (all painted white). I used the Zinsser in all applciations and never had a problem.
Suprisingly, a few good coats of paint will effectively make anything but the biggest knots disappear. A quick rub over with latex wood filler will help smooth over the real big knots.
Hope this helps.
Also, hopelessly lost in the snow. (Over 600 cm this winter - a 119 year old record. That's almost 20 feet of snow for those still using the imperical sytem.)