Blazin-saddles – is this what you’re suggesting?
http://www.screwfix.com/p/mapei-floor-wall-tile-adhesive-grey-20kg/4367d
Yes, that would work fine. It’s grey however so could be a bit of a PITA if you’re using light coloured tiles. Keep a sponge and water handy to clean up as you go, keep the joints as clean as you can, you don’t want adhesive in your groutline as it will show once grouted unless attended to.
The cement based stuff and the spots on the wall are all going to be waterproof so tanking is un needed IMO but normally a good idea. Looking at your picture it looks like the bath will butt against a pretty solid row of dabs, just make sure you silicone between bath and wall before tiling to give a secondary defence fro water leaks.
It will be quite hard work and messy like this so……
To be sure of water tightness (and is good practice), skim the holes with the adhesive and allow to dry, silicone between wall and bath then tile and silicone tile to bath joint later once dry. Leave a 2mm joint between bath and bottom tile, don’t place them hard down on the bath, this gives somewhere to silicone rather than just a smear on top.
No need to go smashing it all off, just to replaster the bottom half which won’t be waterproof at all by then.