I probably should have also said that I am trying to avoid any serious mud work.
Amazingly (to me anyway) I was able to cleanly scrape away the paint in the regions that were bubbling. It doesn't appear they used green/purple board but maybe my house pre-dates that. Also, it doesn't look like they used primer as I was able to scrape down to the drywall surface.
My plan now is to put on a thin coat of mud to seal and transition the scraped edge, put on two coats of a good mold-resistant primer and then paint two top coats. Given the location any minor imperfections should not be very noticeable.