I am in the process of doing this in my MH. I used the sticky joint tape and drywall mud. I had never done this before, so I'm not a great mudder, but it is coming out fine. I didn't use anything to prep the walls except to give them a good scrubbing and then wash with TSP. You will have to prime the walls so the wallpaper pattern doesn't show through, and I have read that if your walls are smooth and shiny to scuff them up a little so the primer and paint stick.
I guess it would be cheaper to paint over the strips, but the only difference is not needing the tape and mud, and they are not that expensive, all the other prep work for painting would be the same.
Good luck, and have fun!

Thanks tiggerbear. I love doing makeovers, gives a fresh new look.
I'm planning on doing the wall texture all over the walls, not just the strips (posting a pic of the overall effect I'm wanting to achieve, hopefully). I will be sure to wash them good and pick up TSP. So are you saying I should scuff and prime walls first to get the mud (joint compound) to adhere?

Would love see pics of your work.

I did not scuff or prime before taping and mudding and both adhered well.

I am going to try painting a small area without scuffing (is that a word?). I will prime to cover the wallpaper. It has been super hot and humid here so painting is on hold for now.

I love that texture. I was thinking of trying to texture, but not sure I'm ready for that. Maybe a little more internet research is in order for me :)