I did not know what T1-11 is.  So I used Google to look it up.  Its exterior house siding for those others who don't know.  But the funny part is both Home Depot and Lowes sell the 19/32" x 4' x 8' sheets for exactly $34.12.  Both the exact same price down to the penny.  Apparently Festool is not the only one who uses price fixing for its vendors.

HD, Lowes and Menards keep their prices identical(nearly identical) for basically everything they all carry. It's also not like there would be a reason for the prices on the same stuff to be any different.  Also with the case of HD and Lowes since they have return policies that allow you to return anything as long as they sold it at least once, it means no one will try playing an exchange game returning something they bought at lowes to a HD to come out 3 cents to the positive and such.  Also I just don't want to think about people cross shopping lumber, buying some at one, and other part of their needs at the other outside of a situation where the quality at one is junk that day.

I built a 24x50 shop about 5 years ago and used 5/8 osb and then 1/2 drywall over that.  Drywall gives me some fire protection along with a nice finished look and the osb gives me the ability hang things anywhere I want.  Been very pleased with the way it worked out.

In my basement shop I used 1/2" MDF on the walls dividing the shop area from the mechanical equipment and storage area.

Rather than the expense of double layering the walls with plywood and sheetrock, why not just add a few rows of blocking in obvious places? When I frame a kitchen, or bathroom if I have the option I put in as much blocking as I can to catch cabinets, towel bars, etc. It makes life so much easier...

Because maybe there will come a day when he wants to install something in a NOT obvious place.  You yourself say you put in as much blocking as I can.  Does that mean blocking 100% everywhere?  To catch cabinets and towel bars everywhere and anywhere.  The double layering just eliminates any future problems with installing anything anywhere.  Its not the easiest or cheapest method, but is the most foolproof.

There is always extreme options such as covering the walls in 2 bye material.  Room covered in 2x12s is a room that isn't messing around, mount anything anywhere, plus can always take up axe throwing.

Slightly less extreme would be some sorta of profiled siding.  "car siding".  You can get it in pine, and it lays flat.

Slightly more extreme...Brick?  Good if you branch out to metal working/forge work.

Random update, but I went with drywall. Used 5/8" firecode for the ceiling as the trusses we're 24" OC to avoid sagging, and 1/2" on all walls. Insulated before drywalling and installed a little Cadet 240v dual-element wall heater fully understanding it wasn't going to make the shop comfortable but "bearable." Totally works for that intended purpose in our mild west coast winters.

Drywall was simply WAY cheaper than some of the other materials we've talked about here, the only really downside being how fragile it is, and the fact you have to find studs if you're mouting anything heavy. I still plan to wall-mount a few French cleat lengths and build some cabinets and tool hangers. Going to keep those cabinets lightweight and simple. Will take some pics when it's all done.

What's amazing is how much larger the shop feels when you get the drywall installed--white makes such a huge difference compared to the exposed studs and insulation. Also, gives me appreciation for the work of drywall pros. I enjoyed taping... Once you figure out how to use a curved trowel, things get a lot easier.

Onward to getting the 6" dust collection ductwork installed and copper fixed air lines... My project for the next three weekends.

I put the T-11 siding over my drywalled walls in my garage that I converted to a shop, but I also added an interconnected with my house's other smoke detection system a smoke detector in there as well just to be extra safe. 

Part of the idea was with the dust collection system whereby I read that if you MAYBE sucked up some metal into your collection bin, a spark may start a slow smoldering fire that may go undetected for hours after one leaves the shop and is sleeping away upstairs.  The chances of this happening are frankly remote for many reasons that are arguably valid, but it really was cheap piece of mind for me to do such along with having a fire extinguisher, eye wash station, first aid kit, telephone, and a power outage emergency light in my shop for overall safety reasons. 

The biggest risk of fire in a shop in my mind is leaving rags to dry that have had volatile finishes on them.  Those I just put outside on the grass or snow and lay some rocks on them for disposal the following day.