Welcome to the Grumble!
I've been doing quite a few military shadow boxes lately. If you want some ideas of layouts, you can checkout my "military shadow box" page on my website:
samples of military shadow boxes
In my opinion, the 'clouds and sky' background may make the shadow box too busy looking and distract from the medals, etc. I tend to use suede mats in my shadow boxes, although on one occasion, my customer had a piece of air force plaid that he wanted to use as the background for the medals. Often it is nice to choose a suede colour that goes with the specific branch of the armed forces (e.g. dark blue for navy, green/khaki for army, etc)
An important thing to keep in mind is there is a specific order which the medals are to be displayed. If the medals are already mounted together, then this shouldn't be an issue as they should already be in the right order. However, if they are separate, you should find out the correct order. If you search the Grumble archives, I'm sure there are references to websites that you can check for the ordering of medals.
Using a glass with UV protection is a good idea as well as it will help keep the items in their best condition (i.e. reduce fading of ribbons, etc)
Best of luck with your first shadow box. I'm sure you'll find it very rewarding to work on (although labour intensive). I love to hear the stories behind the items being displayed. Some of them are certainly heart-wrenching. I'm currently working on one that is 2'x3' and has 22 items to be displayed.