I am thinking about my upcoming garage project to insulate and cover the walls and ceiling. I am torn between putting up all sheetrock, all plywood, or a combination of the two. I like the price of sheetrock, but not the durability and I don't really like OSB, so I was thinking about using a better grade of plywood.

Here are my thoughts. The wall adjacent to the house (attached garage) is already sheetrocked for fire code. The rest of the walls are bare studs. I am thinking about putting sheetrock on the ceiling and the wall with the garage door and then putting plywood on the back and opposite side wall. Having plywood on these two walls would also give me the flexibility of being able to remove it and adjust/add outlets, etc. since this is where most of my outlets are. I'm not quite sure how the transitions would be handled Would I mud the corners where the sheetrock meets the plywood?

Am I crazy to think about doing this? Has anyone else attempted this?