Hi: We were in the same boat about a month ago. We have a low basement which did not allow for drywalling. We actually had the walls finished & then, after looking on various forums decided to spray paint the ceiling flat dark brown. Would have gone in a lighter shade, but we had so many wires & uneven ducts, etc. thought it would blend better in a darker colour. Wish I had before pictures, because the improvement is astounding with the finished walls & ceramic. May not look so, but we are very happy with the result & would 100% suggest going for the painted bare ceiling. Here is a link that might be useful: laundry rm with exposed painted ceiling

Good luck. I hope you find a solution. I do put one of my two cats downstairs but I physically caught him eating the insulation on multiple occasions so I obviously try not to do it for too long now but now that I am doing renovations upstairs and I am also doing partial renovations downstairs he's going to have to go there more often because I need to put him somewhere and there are other issues with other rooms. I guess I will just have to pull out all the insulation as I cannot do a drop ceiling (you will see in another long post that is one of the things the town has told me will make my basement "finished" and they will re-assess my taxes. I have no idea how much he ate before I realized what he was doing UGGHHH. I took in my ex-husband's cat almost 2 yrs ago when his house was destroyed by fire and the two cats hate each other even though I introduced very slowly and did everything by the book so it makes it more challenging trying to separate them and keep mine out of the basement (my house is NOT big). I guess it will just be easier to take down all the insulation but it's fairly old and nasty too so it won't be a very pleasant task.

We had an electrician do all the lights outlets etc (to ensure it was to code and prevent myself from getting injured and/or burning down the house). They're 4 in. dimmable LEDs. There's 11 total for the 32x12 foot room (10 for the room itself and one for the bottom of the stairs (where the yellow wall is). They're evenly spaced apart along the 32 foot length, so rough math says 6 ft or so apart. The blue wall to gray wall is 12 feet, I'm not home but looks like maybe three feet from long walls and 6 feet between the 2 rows). We're happy with how it turned out. Originally the ceiling was going to be exposed as this thread started but firecode changed that. That back wall with the door/windows was going to be all brick, making a loft look. Loosing the ceiling meant loosing the loft look, so I didn't want to spend the money doing the brick wall.

The basement ceiling height of the house we lived in when our kids were teenagers wasn't much higher than yours. My husband sprayed the underside of the main level floor matte black, covering all pipes and ducts. If you DIY, be sure to use a good respirator mask. Our son was the same height as your husband (now slightly taller) and my husband was just a tad shorter. Neither one was bothered by feeling as if they were about to bump their heads. We had no issues with dust. As for noise in the basement, I think it was only noticeable when someone overhead wore high heels. I didn't find that the sound of video games or movies in the basement carried upstairs any more than in a later house with a drywall ceiling. My family liked the look and I was happy to put the money that would have been spent on a finished ceiling toward other things in the house.