I am not a fan of sheetrock in a garage. It's too fragile and looks like crap if you ding it. I am also not a fan of bright colors since they show everyting. Mine has lightly stained plywood, and I love it. You can pound a nail anywhere, and bonk it with a jack handle without making a big ol gack mark.
Since the walls are a little darker than white, you need a little extra lighting, of course.