Wall Insulation

Trying to accumulate info.
Will be tearing out my old lathen plaster from my 1920's weatherboard house and would like to insulate the walls before new plaster goes on.
Was just planning to put in some batts in the wall cavities. Is this okay or do I need to worry about vapour layers which I'm less sure about. In my very limited knowledge I would have thought that the vapour wrap stuff could only be put on if the weatherboards were off. Does any one out there know...........

The better method would be to have a vapour barrier to stop moisture getting to the insulation, but obviously this isn't possible in you situation.
The sisalation doesn't have any thermal benefit.
I would look at installing R2.0 batts between the studs.