Hopefully a wall directly behind this faucet wall will have an access of some sort to get at the piping. If your house is 50 yrs. old, you will probably have galvanized pipe. If the shower is on the first floor, it would probably be wise to change the piping from the cellar up to this fixture with copper because you will probably end up having to use some copper in the change over. One of the major companies (either Delta or Moen) makes a large plate that will fit over a hole that you would have to make to change the faucet from the tub side. The company that makes the plate has a faucet that fits perfectly into this plate. The Moen plate is called a "remodeling cover plate" and the part # should be #1920. I don't have a Delta number. Even with this, you have to be careful and not make a hole any larger than the plate will cover up. If you have ceramic tile on the shower walls, then the job gets even trickier. It would probably be a whole lot easier if you could do most of the work from the backside.

Did we have this discussion a few weeks back? Can you get another spout with threads that aren't recessed? If not, in my opinion it is much easier to do the job from the rear. You can leave some kind of acess panel which could come in handy. I tried messing with tiles once and it turns into a problem trying to mount replacement tiles on a backing that isn't secure. Also, there is a thicker teflon tape available. Could you try that with thread paste on top to see if that stops the leak?

Yes, the plumbing needs to be done first. Yes, you may be able to just get another acrylic shower wall to cover over everything, if the wall is not moldy or wet behind the tile that you are looking at. There is no need to replace the tub itself if it is in good shape, even if you do decide to take down the wall tile and replace everything from the studs out. Just make sure the workers cover the tub well to protect it while the work is being done. I am with Monicakm_gw, get some more bids for the work. You might want to have them bid on just replacing the walls with new fiberglass, and on doing the whole new tile job, too. You can see new walls at Lowes, Home Depot, and Menard's online. There is also the whole Marbleite wall option to look into. Local dealers for Marbelite are supposed to be cheaper than buying from big box stores, if I remember right. While you are fixing plumbing, you should probably put in a proper mixing valve to protect from scalds. It is the code now. No one will be able to turn the water too hot to burn themselves and flushing the toilet or using the water elsewhere in the house will not burn the person in the shower anymore, either. I have read the experts here on the forum say that the Symmons Temptrol system is very good and is a good value. Here is one that comes with the shower head and tub spout for under $100. http://www.homedepot.com/p/Symmons-Temptrol-1-Handle-Tub-and-Shower-Faucet-in-Chrome-S-96-2/100643619

Replacing the whole unit will certainly require wall repair. You can probably replace only the cartridge instead.