Herewith my two cents worth, having done several conversion jobs on structures including garages:
1. First step: determine your electrical needs, including whether or not you will need a subpanel to provide them. If you plan on using electrical baseboard heaters, be sure that a) your electrical system will support them and b) your wallet will too. Newer homes usually don't need subpanels - older homes usually do. Really old homes need a licensed electrician. Baseboard heaters can get expensive to operate, depending on your area. Here in Colorado they seem to run on money, but sometimes you don;t have too many options, either.
2. Install all electrical outlets, ceiling light fixtures of whatever type, light switches, etc., onto the bare studs.
Leave the proper spacing for the thickness of your drywall. Apologies for the emphasis, but this is too often overlooked by DYI'ers. Now is the time to consider where to place electrical service outlets and switches relative to your model layout, so that the crucial switch is not buried behind a mountain or just out of reach. Been there, done that and done it over again to get it right. As the guy said in
The Last Samurai - "...too many minds..."
3. Insulate with the highest R-value you can afford. There is no such thing as too much insulation. Vapor barriers are a must if the area is heated, and be sure the barriers face the right way. Alternatively, there are pray-on wall insulations that are easy and efficient to apply, either by yourself with rental equipment or by a contractor. The advantage to the spray stuff is that there are no gaps at all if done properly, especially around those pesky electrical boxes.
4. Drywall: check local codes. Many areas require fire-resistant drywall and a specific thickness for garages. If you use electric baseboard heaters, put in fire-resistant drywall even if it is not required. If you can handle it, use the 12' sheets and install them horizontally on the walls with the proper joint overlaps. This works a lot better than vertical application. For ceilings, rent a drywall lift which is a gadget that holds the sheet and pushes it up against the ceiling, leaving you free to work without strain using both hands, or build a simple holder out of 2x4's. Attach drywall using drywall screws. Most places require this by code now, but in you have seasons, nails will pop due to expansion and contraction - screws won't - and screws are easy to put in properly without damage to the drywall that you will have to repair when you do the nasty part - tape and mud part. Screws are also handy when you goof up and have to remove them, thus leaving olny little bitty holes to cover up.
5. Garage door: frankly, I would take it out and stud in a standard wall, thus allowing for insulation, electrical and so forth. If you think you need access through that side, consider putting in an insulated door. You are unlikely to move in anything larger than your base unit lumber, unless you do modular modelling in which case consider a double door such as shops use. If you want/need a window, plan for it ahead of time.
6. Ventilation: I know; here we are discussing keeping the place warm and suddenly I'm talking about blowing cold air through the place. Don't know what your climate is like, but things can get stuffy, and good air circulation in warm weather is a major comfort item. I mention it here because you might want to consider a filter system to keep dust to a minimum, as modelling layouts hate the stuff. If you plan to have groups inside during warm weather, a/c might be somethng to consider.
7. Just a passing thought, but when planning benchwork, consider catilevering it off the walls, easy to do, thus leaving the space below unhampered. There is also no sauch thing as too much storage space.
8. If your garage is stand-alone, consider if you want an intercom while you're doing the intial conversion work. This allows you to call the "Big House" and order another cold beer without taking your hands off the throttle of your favorite loco! It also prevents that "I can never get you when I need you because you are so wrapped up in your hobby" speech.
9. Don't forget a work space for yourself for creating all those terrific models, and consider if you need special lighting or other requirements for that before you set it up.
Forgive me if this sounds innappropriate in any way - did I mention that I have made all of the possible mistakes myself while I was learning how
not to do it right the first time? It's just like modelling - if you get the basics and the first steps right, things go a whole lot better later on.
Good luck and many years of enjoyment! I envy you- you have the makings of a dream layout.