I had posted earlier about how to paint on walls that had painted-over wallpaper on them. We now have (maybe) a more complex issue:

Some of the wallpaper had bubbled up, so I began to tear it off. Some sections of the walls are now bare plaster; other sections are a mixture of plaster/painted wallpaper, yet other sections are all painted wallpaper with no bubbling.

So where do we go from here? The local hardware store suggested coating all the walls with "mud" aka topping joint compound, sanding, priming and painting.

Does anyone see any issues with this process?