New Drywall on Cinder Blocks with 1x2s?

My below-grade basement cinderblock wall had 4x8 sheets of grooved paneling on it which we had painted white. The paneling was nailed to 1x2 furring strips. But water got in months ago and I finally torn the old paneling down. The mold, rot, and stench was far worse than I expected. I found the above-ground source of water and fixed that problem.
I will "paint" the wall with 2 coats of Dry Lok to keep future moisture out. 2 questions...
--If I choose to take the entire room down and install drywall instead of just replacing the sections of paneling, can I put DW over new 1x2 furring strips on cinder block? Are there drywall screws that short???
--If I'm concerned about moisture and use Dry Lok, how should I hang the 1x2s? Won't cement nails break the Dry Lok barrier? Should I use construction adhesive instead?
Thanks!!!!!!
JB
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On 7 Apr 2006 07:15:32 -0700, snipped-for-privacy@gmail.com wrote:

I'd be tempted to glue 1/2" foam to the cinderblock, and drywall to the foam, and skip the furring strips entirely. Or, if you're not running wiring and you're not insulating, why not just parge the block, and not cover it with anything?
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Drylok wont stop all mosture from coming in. If there is enough pressure coming in the paint will simply lift and flake off.
I would recommend as much space as possible from the wall. Then you can install mosture resistant drywall and maybe some isulation. I would not want to enclose ANYTHING onto a cememt wall.
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most people would use 2" x 2" in order to allow for electrical boxes and insulation etc.

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Unless you're in a really dry climate, an uninsulated and unsealed wall will begin rotting immediately. Someday someone will have to rip it all out and start over again.
Frame it with 2x4s. Insulate with R13 batts. Vapor barrier on the room side of the studs. Then drywall. That's probably required by code anyways.
Also, it's a good opportunity to seal the slab to wall joint before applying the dryloc.
-rev
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