A soffit kitchen redo may be required if you are remodeling your entire kitchen. However, you can also do it when only a kitchen cabinet refacing. Either way this will only mean soffit placing above the cabinets.
First you may have to verify whether the soffit is the original or added later in the kitchen. If the original is not possible that the lathe and plaster ceilings can cause some problems when removing it. To verify that it was just a small hole and see.
If it is genuine you may find that there is no ceiling so you may have to replace it but if it is installed then there is a chance that the existing ceiling. This means you can choose to remove and utilize the space with a higher taxi.
You may find that when you remove it you will find old water damage in some corners, especially where the plaster has been totally removed from the ceiling battens. You can simply remove the plaster so that you can add a hidden light and the use of sheet rock.
Options in installing soffit are to make it run around ½ of the kitchen and let the kitchen cabinet to go to the ceiling in the other half. Just leaving about two inches of space between the ceiling and cabinets.
You can then put the crown molding in the closet to make everything seem finished. Just put it all the way around. If there is not enough space for the crown in the soffit only using molds bay.