I ripped out the 2 inch thick, metal lath/concrete/pink tile walls (that apparently were really popular in this area) so I am going to have to retile the entire shower already anyway. 

I realize I didn't spill out the entire plan from the first post,  but that's simply because most people don't want to read a wall of text with a ton of information if it's not beneficial/relevant to them.

The lead inspector stated they have to be fully enclosed and mechanically attached to the wall and floor.

My houses use concrete block walls with furring strips nailed to then that then have the drywall applied on top of that.

Thanks for reading the giant wall of text, I'm sure there is so much I could add too, so if there is anything you'd like to know, please just ask!

Question, is it important to insulate the foundation walls?   

The upstairs needs carpet...Old blue steps lead up and the entire floor upstairs is painted blue...This is lead paint which im not sanding or adding the expense of painting over except for on the side walls above the stairs.

If you just want to see if they are clean and not bashing walls in, then if your mom would walk through it for you, it's probably the better way to go.  

Vinyl damages so easy, a barbeque grill can melt an entire wall, the door can get flipped open in the wind and knock a hole in it, etc. 

They could start dating a "bad boy" who likes to hit holes in walls.