Okay, the tile guy was not really a tile guy (he's a grout guy) but he was fantastic about answering my million questions and offering advice. Here's a freebie for you: when you take a shower, wipe down your tiled walls with a towel. If they stay dry, your grout will last a lot longer and you won't have to bleach any mildew stains. Because if you use a lot of bleach on the grout it dries it out and will have to be replaced sooner. Dry your tile and use vinegar and water to clean and disinfect.
Now back to my bathroom. It does not seem reasonable to me to pull out all the tile. It's in good condition, it's quite common in this area for this age house, and according to the guy above (who lives in the neighborhood with a house about the same age), there is probably a concrete wall behind the tile. It would also be a pain to pull out just the yellow tiles at the top and bottom of the walls. Too many problems trying to match sizes, especially at the bottom of the wall.
He did recommend glazing the tub and the one person he said to use is the guy I've already called. He also said I could probably pull out the fixtures (soap dish, toilet paper holder) and replace those fairly easily. But now I think if I replaced them with white ones it would look rather glaring. Finally, he said that barring any structural problems, we could put down a new tile floor right over the old one.
--brief aside: What was it with people in the 50s? Was it really all black & white like on tv? Is that why none of the yellows in my bathroom match? Or was everyone just colorblind? --
So I'm down to thinking that a new floor, a tub reglaze and some color on the walls is the way to go. I showed John the wallpaper last night and he doesn't like any of them. Sigh. I am so over this bathroom.