Another Basement Insulation Question

Hey everyone. I have have scoured the board looking for an answers to a fairly specific question so I apologize it is already out there and I just have not found it. So my situation is that I think I was given some bad information and now I am trying to resolve it most efficient way possible. The previous owner started to finish the basement but only got as far as putting up the studs. During the home inspection, the inspector pointed out that the previous owner put the studs right against the block wall and did not use PT wood. The inspector told me that I should replace the studs with PT and waterproof the block. So that's exactly what I did. Since then, I have also installed electrical outlets. I was trying to figure out the best way to add insulation now before finishing with drywall when I learned I should have added foam prior to putting the studs back up and I should have left a 1-2" space from wall to studs. Considering that I have used waterproofer and PT wood, would it be worth the time and money to take the wall down and start all over? If no, what would be the best material to use to insulate? Seems to be foam? (I live in eastern Nebraska) I wish I would have done a little more research before replacing the studs! Thanks in advance for your help!