The basement in our 1950 Cape Cod (located in Minnesota) was finished about 20 years ago using tabbed pine slats. The wood is really nice and would cost a small fortune to replace. The ceiling is drywall with plaster sprayed on top. Unfortunately, the person finishing the basement did not insulate at all. The pine is attached to a lattice of thin pine slats (1" thick) nailed to the cinder block walls. What we want to do is find a way to insulate without destroying the walls. There is also no insulation between the ceiling and the floor above so all the heat immediately rises out of the room.

Any suggestions of what is the most painless way to do this. We are considering everything from liquid insulation to carefully tearing down the ceiling/walls , putting rigid foam on the walls and trying to re-attach the same panels.

In any case, it would be much easier to rip down the ceiling (which wasn't well done). This would allow us to add insulation in the ceiling and lay it around where the foundation attaches to the house, which leaks alot). Is the extra effort of ripping down the walls going to help our situation enough to justify itself.