Flakey paint on plastered walls.

Everbuild 406 Stablishing Solution will seal & bind the surface ready for painting (brilliant product).

http://www.everbuild.co.uk/406-Stabilising-Solution

Can't tell from photo how bad it is, but a rubbing down with a fine paper will remove any loose bits, fill any holes,etc & rub down, then a coat of 406, then a good quailty emulsion, reckon you will get away with two coats.
Where is Astramax.

http://www.everbuild.co.uk/406-Stabilising-Solution

 

Electric sander & a fine paper makes the job so much quicker.

 

Don't Sand, it will just make tonnes of mess! You can't really fill the surface differences as the patches are far too big and you'll spend time feathering out every area.
What I would suggest is getting yourself a scraper such as this
http://www.screwfix.com/p/heavy-duty-scraper-4/16530
Works a treat! Just be careful not to


catch the wall. It will make mince meat of that paint.
Another alternative is to get a bucket of warm water and a cloth/sponge and wipe it off but be careful you don't saturate the plaster.
The walls look in good condition. It looks like the first coat of paint put on it wasn't watered down and so when you have removed the wallpaper on top it has just pulled the paint off the surface as it hadn't adheared properly.
Your fist coat, even though it's older and previously painted plaster, I would personally give it a mist coat. Then continue as normal with decorating.
If you do buy the scraper above; the blade is in backwards fir safety! So undo the screws, turn the blade the right way around and away you go. Screw heads are a little soft, so go easy with screwdriver!

 

Careful use of a wallpaper steamer works wonders as does a decent orbital sander..

 

You need a dustless sander to take it back. Sand or skim it are the options I would use but if you can't do that then line it.