How do I fix drywall damaged by peeling paint tearing off the outer paper?
You'll need to patch the areas, where the paper tore off, and then skim coat the entire wall, so that the patched areas, don't stand out "shinier and flatter", than the rest of the wall.

At this point, Google is your friend, especially if you plan to fix it yourself. You may also be able to get a contractor, to do the whole thing, for a fairly cheap price. Prepping a bathroom for paint, is beer money for some guys.

Research, research, research!