I hope this helps anyone else who has a similar situation. It ended up being a very easy fix with a coat of spraypaint and some Mod Podge.
Here is the wall Before...
You can see the parts she's managed to shred. The nicer-looking part of the background, to the right of this picture, was towards the bottom where she didn't climb often.
Scotty spray painted the wall using Valspar stone spray paint. We had it left over from when we created the castle inside Loki's tank. We gave it a few days to dry and air out.
I painted over the wall with Mod Podge. I went pretty thick on it, mainly because I got bored. It still came out just fine. I am definitely a "glopper."
And here it is back in Loki's tank!
The wall is not perfect, by any means. It still has the appearance of being roughed up and it looks like bits are going to fall off. However, it is very definitely sealed and is smooth when you run your finger over it.
We created the castle, linked above, in a similar way. It just involved cutting out the styrofoam ahead of time. We glued together the pieces of styrofoam using wood glue, went over it with the spray paint, and Mod Podged it. Next time I need to make something like this I will definitely create a tutorial for it.