Liz, you can use 30 lb felt to cover the wood. Lap it from the bottom up. And if you want to really seal the laps, use plastic roofing cement along the lap-seams. At the foundation line (concrete to wood, if your home is on a concrete foundation), seam the paper to the concrete with the roofing cement, but allow enough room below it to plaster to the concrete foundation.
Next, use a small mesh chicken wire, or else mesh lath. You can nail it on, or you can use a staple gun to attach it.
Next, rent a mixer (or buy one) and mix on the 3 to 1 ratio: 3 sand to one shovel of masonry mix (type N or type s). For a half-bag mix, you add 9 shovels of sand (masonry sand = no pebbles), add water until it is of oatmeal consistency. You don't want it to dry, nor to wet. It should be of a consistency that allows easy troweling.
Next, you will need a hawk and a plastering trowel, wheelbarrow (contractor size). Place your mortar in the wheelbarrow and use your trowel to place it on the hawk, or else place the mortar on a mud board and push it onto your hawk from there.
Next, skim coat the lath wire. You only want enough top embed the wire on the first coat. Then, scratch the first coat with a rake or any object that will make a rake deep into the plaster coat. Do this rake in verticle and horizontal directions for thje length of the area being covered. Allow to dry for one day.
Next, wet the wall and put on a heavy "brown coat." To make certain it's evenly distributed, use a length of 2x4 or anything that will work as a straight-plane darby to even off your work. This is the second coat. Permit it to dry for a day or two.
Next, wet the wall and stucco the brown coat with your choice of design. You can make it with a Spanish look, or any number of faces you prefer. But, the mix should be as follows:
6 parts sand to 1 part hydrated lime, to 1 part portland cement (gray or white - you choice). If you want a stone look, add commercial coloring to your mixes and cut in joints to look like stone was laid. Do the joints as the stucco goes into the set. You can also color in the pre-fab stones after it dries with various paint colors that are on the market designed for masonry.
If you want a spanish look: Coat the brown with white stucco and let it go into the set (stiffening but not set-up) and then take the edge of your trial and feather stucco ont the set stucco, then, using the trowel flat, trowel it against the previous coat in a fanning motion.
Finally, keep the walls damp (after a day) to fully cure for at least 7 days. This will help the cure-out process and prevent a lot of cracking.
Good luck with your project. I'm a contractor in North Texas, so if you need additional advice, just e-mail me. ----Jack