time2roll,
You are correct.
In my case with my motor home's interior, I would have needed to remove everything, furnishings and all because the material was throughout including the inside of the cabinetry. Then peel off the material, and then with a metal bristle brush, remove 100% of the foam, both crumbled and good, then attach brand new foam-backed head-liner material with a contact adhesive on both the foam and interior wall surfaces. It is the same process as restoring a headliner but on a much much bigger scale. Adding the complexity of so many different surfaces converging, there were finished seams to deal with. It would have been so much for anyone to deal with. That is one of a few reasons why we decided to sell the rig.
I also looked into a spray-on bed liner material, something much more durable but tan colored, not black. The cost of that option was tremendous.