I have never had any problems with wallpaper in a bathroom- regular, normal wallpaper. I would seriously consider that option. Look at the IGs for major wallpaper companies and see how gorgeous their offerings are in the loo. Good luck.

It really depends on how textured the texture is....can you post a pic?

Want to put guns on your arms? Feeling like you could do with some muscle definition around the shoulders? Want to lose a few pounds before Christmas?
Have I got a suggestion for you! And it starts and ends with sandpaper. You could do the cheap method with pads and a handheld plaster sanding block. Or you could work up the line to the rented, power drywall sander with dust extraction. Drop over to a paint store to investigate your options.

I feel your pain! I am currently painting my bathroom with textured walls (knock down). I started with sanding the walls to remove any high spots. I have done 2 skim coats with drywall mud, waiting for it to dry before sanding. I hope that will be enough, thinking slight imperfections may make it look rustic/industrial. Next will be primer then paint. Good luck to you.

It's either elbow grease, new drywall............or a good vinyl grasscloth. Phillip Jeffries......has the best.

Wallpaper will only work if the texture is not very coarse. Post a pic of it but the best might be to either have it skim coated or a thin drywall sheet installed over top.