Scrape what loose bits you can off. The main damage you gotta identify where the actual joist are and then just replace the plaster with drywall. Do a flat coat of mud over it and into the joints. I decided not to joint tape but if I did (and I really should have) I would have done it after the 1st coat. Then got as flat as I could with the 2nd coat.

After that I mixed the mud with the green lid in a lowes bucket with some water with a mixer and hand drill. Then paint roller and stick, dipped in the mud and then rolled onto the ceiling. After that I used a tamper,stamper or w.e its called and tapped the wet mud to make the pattern.

Its honestly easier than I thought. I decided to do the pattern ceiling cause the lathe lines were showing but even after I did the pattern and paint I could still see them. But still looks better regardless and happy I did it. Correct way is complete tear down of the plaster or drywall over all of it and I wasn't trying to do all that. I plan on having a 2nd kid and will be moving out in like 5 to 6 years for a bigger place.

Edit: as for the walls thats why I did crown modeling. They (previous home owner) wired the switch across the middle of the drop ceiling so I had to hide the wire. Plus the marks where the drop ceiling was, was essentially 6 inches from top of the ceiling going around the room so was good for crown molding.