Why not finish it so the kids have a nice place to play?

Drywall and paint is what I would do.

We were thinking the same thing but our GC said the cost to drywall and paint will be negligible to do at once during the main construction vs. finishing later. The crew is there and the labor in a basement for drywall is minimal. You may pay 2-3 times as much to get a crew in on a small job later. He advised us to cut costs elsewhere and make that part of the working budget.

Can you better explain what led you to not consider traditional drywall finish? If it's a playroom, anything you put up is going to get dinged up. And, it's just a basement, dings will be more forgiven. I would think drywall would be far stronger than the alternatives. And when it does get dinged, it's not all that hard to fill a dent with joint compound and re-paint. I bet it'd be pretty involved to patch fabric.

Get the fibreglass out; it will become wet and mouldy. Or precede it with a layer of extruded polystyrene board.

Just how violent are your kids?

If you're really concerned, you can use a commercial grade of drywall vertically installed. Or add paneling over drywall.

Another possibility is to use foamboards (XPS) alone as insulation and spay it with a cementatious coating needed for fireproofing that can also serve as a finished, if not particularly attractive, wall.

Here is a link that might be useful: Building Science Corp.: Basement Insulation Systems

Ditto about going ahead and drywalling. Much cleaner and cheaper to do when the crew is already there. . . . Don't have to paint it if you don't want to (or you can do it yourself) but definitely drywall, mud and sand.

Thanks for the replies. I'll see about the cost to drywall. Part of the problem is that we would then have to do outlets, and I wasn't going to have them frame the interior walls to give us a bigger space.

Worthy, I was concerned about that but they've already started framing the exterior walls, so putting foam behind them is no longer an option. Anything else I can do at this point, before they put in the batts? Thanks

Get the batts that are enclosed in plastic.

cam-we are hoping to get our basement finished through drywall when we build also. Avoid the mess and all that goes with it after you are in with all of your belongings and comfortable. If you wouldn't mind reporting back regarding if it was cost effective or just too much that would be great. I am really hoping that its much cheaper to just do it at build to push us that way. We will just have to see how everything else comes in budget-wise.