You can do either but first take a drywall taping knife and push it/scrape over the area to knock off any loose and rough stuff.
Before sanding, I would wipe it good with a big wet sponge. That may smooth it over some or enough that when dry, you won't have so much to sand. Use your 12" drywall trowel when damp sponging to see if that helps any. I can't see your wall but you may get lucky. I'd fix your present wall before overlaying it with more drywall.