How can I fix an uneven and damaged transition from drywall to tile in the bathroom?
It looks like all that is seperating the drywall from the tile is a bead of caulking.  To fix this, I would first remove all of the existing caulking.  Then I would cut out the area of the affected drywall and patch in a new piece, using the factory taped edge as the end that butts up against the tile.  Tape, mud and sand the new section and paint to match. Once finished, install a new bead of caulking along the entire length and it should look like new!