I'm finishing my basement. I have my walls done, HVAC will go in soon, and then electrical. Plumbing is pre-run to bathroom. after that is drywall... I'm planning out what I need to do. the edges of my room is about 7'4 due to hvac ducting running in a bulkhead. Should the drywall be horizontal, or vertical? I've heard that horizontal is recommended typically due to the seam being mid height, and strength. But being I would use full panels should I go vertical, or is horizontal still best? the room is 16' x 21'

Hello. I purchased a house and I am making a some renovation. While sanding the floor and removing the baseboards, I noticed that the paint is coming off along with the brown paper. I pulled it out a little bit and the drywall started to crack and fall apart. It doesn't look good. The drywall is dry but it looks like it might have experiended some moisture. Here are some pics: http://imgur.com/a/PizALp6 I also took off a cover and noticed that there are bathtub pipes and valves visible from that bedroom. I can smell moisture, possibly mold coming out of there. (I even found a spider that looked like brown widow but he hid somewhere before I've been able to get him). Maybe there was some leak few years back? https://i.imgur.com/32am9ZH.jpg Should I cut out the drywall? If yes, should I cut only at the bottom?