Wow. Bet you were surprised when you took everything down. Did you use some choice words?

Before you do anything else, find someone that knows some electrical. Wires running across the outside of the sheetrock is not only flippin' ugly, but could be a potential risk to you or your family. If it were me, I'd spend the time to move them behind the drywall.

That electrical panel bothers me a bit. I've never seen flexible steel or aluminum conduit run like that. I'd like to know more. With the things that you've shown us with the wiring, I'd look carefully at the panel to make sure it is properly installed and configured. The last guy doing electrical in there seems to have been a hack without a lot of knowledge, or didn't give a crap. Or both. And that concerns me.

The ill-fitting and holey sheetrock is frankly the least of your work. Depending on the fire codes in your area, it may be 5/8" drywall. Down where I live that is $12 per sheet. Each sheet covers 32 square feet. So the cost to do it properly and clean would be a minimal expense.

Taping and mudding is an art. You can do it, but there is definitely a learning curve. But if you must learn how to do it, a garage is a pretty good place to start. Hiring the job out is easy. A couple of guys could sheet your garage before lunch, and tape and do the first coat of mud before quitting time. You will probably take all weekend. But hey, your time is cheap, right?

And even though this is your garage, your man cave, do yourself a favor and ask your wife what color it should be. Trust me, life will be easier if you do. Voice of experience....

And what is with that honking big beam above the water heater with all the nails sticking out of it?