Patching plaster wall
My personal suggestion is self adhesive fiberglass drywall tape, and lightweight joint compound. The tape can be laid on very thin, but provides some support and structure to the whole area. It can even be ordered in relatively wide sizes that almost seem designed for this kind of patch.

The lightweight joint compound comes (nearly) ready to use and can be troweled very thin and even. I suggest several thin light coats, with plenty of drying time between to avoid cracking from shrinking. Sand flush, then seal/prime the whole ceiling and paint to your desired color.