How much trouble am I looking at to replace a free standing shower. Is it hard to replace the "pan" or bottom and should I rip out the wall and start from scratch, there is tile on the three walls now but it is about 25 years old and I think the walls have a little water damage also.

I'd rip it out completely down to the studs and put in a pre-fab shower pan, cement board (hardibacker) on the walls, then tile. I did this and it was actually pretty easy especially if you can get a pan that has the drain in the same spot as your existing drain.

If you can reuse the drain amriccas approach is perfect. You are looking at about $250 for the pan, $50 in Hardibacker and screws, $150 in tile and another $100 in grout and thinset. Door costs can be anywhere from $75 to $750, that's up to your tasts.