Textured paint is an outstanding way to hide flaws in a walls surface. You will be able to cover up scrapes and stains as well as small holes. It is much easier to apply than wall paper and is available in an unlimited amount of colors. Use border colors which are one shade darker when using textured paint/
Yeah it should because the attention will go on the texture of the wall compared to the plainness of the wall. It's a great way to hide any imperfections your walls have.
The more textured the paint(dry-wall style) the more it will help. Also, put a dark coat of paint down, then sponge-paint imperfect areas with lighter colors for even more texture.