The short answer: you don't want to know how much it would cost to replace the drywall.

The long answer: If you put a new layer of drywall over the old, you'd have to tear out all the baseboards, door trim, window trim, crown mold, remove all the electrical covers and run into countless problems because of the increased thickness. If you removed the old drwall and replaced it, you wouldn't have the problems from the extra thickness, but you'd still have to tear everything out.

I'd hunt around for the best drywall finishers in town and have them skim coat the walls.

850 square feet only tells us how much flooring you need. It has nothing to do with the amount of wall surface that exists in the condo. A condo with 10' ceilings and several closed off rooms will have a lot more wall space than one with an 8' ceiling that's open concept with very few walls. $10-12 a sheet is the going rate around here for drywall. That doesn't include any priming or painting. Just the drywall and the labor to hang it with a couple of coats of mud.

You don't usually paint over bare sheetrock. If you did cover it all up, you'd need to then have it skim coated or textured anyway before repainting.

Cut out the re-sheetrock step, and just go to the skim coating/retexturing step.

"You don't usually paint over bare sheetrock." ????

Sure you do. You just prime it with PVA primer first. Unless you're in the NE where plaster skimcoating exists. Most of the world installs the drywall to a level 4 finish, primes, and paints the finish color though.

That is my point. Most of the world installs the drywall, textures, primes and paints. (level 4 or not, no walls in my area are hardly ever flat--all have textures). So, I'm suggesting you jump in at the finish point--skim coat, retexture, whatever, prime and paint.

I never saw a textured wall until I did some traveling in the western states. I grew up and live in the Midwest and flat Level 4 walls are the norm. No texturing here.

To the OP find a good drywall finisher like Mag77 said.