Tiling the ceiling is strictly up to the homeowner. If it's not a steam shower, there won't be enough moisture to get to the ceiling to cause a problem. A good quality paint will work just fine.
As for the tile, is there any particular one that you're looking for? There are many types out there that will work for a shower. For a DIY'er, the tile or stone with a rectified edge can be a little more difficult to get flat. Stone can also be a bit more challenging because every cut has to be made with a saw, and the chances of them breaking are greater than with ceramic. Maintenance is also a little more difficult with stone. You may want a larger grout line, like 3/16" or more, with a beveled edge. Somewhere between 8" to 16" would probably be the easiest to install, at least they are for me.
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The top ten reasons to procrastinate:
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