With deconstruction over, I was able to get one wall of the layout covered with my wispy clouds backdrop from Hobby Lobby.
Because the walls are tongue-n-groove knotty pine, I had to first cut and install 1/8" thick Masonite boards from Lowes, which have a smooth white surface on one side. I applied the paper cloud backdrop to the Masonite boards while flat on the floor using a "workable" spray adhesive and then tacked the boards up with a brad nailer using 1 1/4" brads at the top and bottom. The top will be covered by a 1" trim molding painted sky blue and the bottom will be covered by the plywood and foam layout base.
Hopefully, I can finish the other walls at night this week.