I agree with Steve. Tear it all out if you can. I would highly recommend concrete backerboard over greenboard. Green board is fine for a tub but it won't last more than a couple of years in a shower. Thinset mortar would be a stronger alternative to mastic.
BUT, this is based on you having drywall behind that tile. A lot of older homes have the shower walls floated out with several inches of concrete over wire lathe. If this is the case I would try to remove only the tiles; refloat the walls with some wall mud (mortar mix) and thinset some concrete backerboard to the finished walls to level it out somemore. Then tile over that.