Drywall – Prep drywall before backsplash

Here are some good points against using plywood, the source is talking about tiling a floor but most of the points are valid for walls as well.

In my opinion it's better to go the "overkill" route, then have to redo the job in the future because something didn't turn out right.

The cost difference between plywood and cement board is negligible, so your not going to save any money using plywood (unless you already have it).

Do the job right and use cement board, when you don't have any problems and you can enjoy the tile for years to come you will never regret the decision.

Assuming this is ceramic tile - not glass or stone - and you are going to do the standard mastic installation, if there is only mild damage (for example, a few 4-inch patches ripped off) either just ignore it or use joint compound to fill.

Joint compound is not strong at all. It is pretty crumbly and soft - i.e. it's not plaster, even though builders nowadays use it to skim-coat walls for texture (you can easily gouge it with your fingernail on such installs). So if there are large areas of damage, I would cut out the sections of drywall and replace them. This is not difficult, because although you should still mud-and-tape the joints, you don't need to sand much since you'll be covering it with tile.

Final comment - I wish, on my installation, that we had added 1/4" hardiboard over the sheetrock (with const. adhesive and screws) to stiffen the wall. My wall has the garage door in it, so the wall gets flexed and the grout cracks. Just FYI.

(Adding Fein Multimaster picture, see comment below)