I'm looking to install chair railings for decorative purposes only. I have a 9ft floor to ceiling dimension. Keeping in theory I am installing at a 36" height. On one wall i have a fireplace mantel and 36" is fine . But I have a problem with two other walls, because installing at 36" would put my chair railings under window instead of to the side of window casings. If I install higher it will be too high next the mantel. What would be the lesser of two evils.

How high above the floor are the bottoms of the windows?

To begin, a fireplace is generally an important visual focus point for the room. I would definitely make it look as good as possible.

The general rule of thumb is one third of the distance from the floor to the ceiling. In your case, as you said, it would be three foot because you have 9 foot ceilings. However, that isn't a hard and fast rule. If three foot puts you against the bottom of the window, and you don't like that look, consider dropping the chair rail a few inches to leave some space between the bottom of the window and the chair rail. (It will look better, visually.)

Normal chair rail height is 32 to 36 inches off the ground. I would try to stay in that range, or it will look a bit 'off.'