okay, that 2nd pic was hard for me to make out but it all looks okay. i wouldnt take ANY drywall out unless it will help you sleep better at night. the damage is always going to be worse at the bottom so if the bottom is cool there is no reason to believe farther up to be worse. it is unusual that this is all that was done though. I would still get the treatment and have traps put out and monitor them yourself. structurally speaking there is nothing wrong. just flake off the loose paint up the wall and skim with some drywall mud (any kind is fine but lightweight is easier to sand) please feel free to PM me if you need anything. you just have some very minor cosmetic probs. easily fixed by ANY homeowner