Unless the drywall is in really bad shape I see no need in removing it. Be sure to nail the plybead up securely by hitting the rafters. The only thing I don’t like about the ceiling application is the joints when you are stacking in over 8′ lengths. I belive the sides are grooved to form a repeating bead, but the 4′ ends are square cut. If you are stacking the pannels then you will need some sort of decorative moulding to hide the seam. Do not butt the pannels up tight against each other, leave them room to grow with different humidity levels.If you don’t the pannels will buckle. I would suggest a space about the thickness of a dime or nickle for expansion and contraction. You might paint behind the panels, where the groves meet on the 8′ lengths, the same color as the grooves to help concealthe gap where it is not noticeable.