You guys are all wrong. I would install drywall THAN cover it with 4' x 8' FRP panels. They sell it at Loews and other places. You see it used in bathrooms of gas stations and fast food places, kitchens. It's 1/8th" thick and tough. They sell all the trim pieces to finish it off. I installed it in our laundry room and its great.
http://www.sdplastics.com/frpwallpanels.html