I'm replacing some grout in my walk-in shower. It's about 1/3 of the grout had cracked, or had fallen out. The original grout is un-sanded, and the guy at the tile store told me that I should go with a sanded grout. He said it would be stronger. Is that so? If so, would there be a noticeable difference in the 2 grout types once they dry?

The ceiling is up on a 45 degree angle, will the grout stay in w/o a problem?

Also, in corners where walls meet floors and ceiling, should they be grouted and caulked? I have been getting conflicting view on that.

Thanks

Sanded groute is used for larger spaces between tiles. Such is in floors. Non-sanded is used for walls and tiles with small spaces. 1/8" or less typically.
As far as color match. Unless you get the grout from the same lot number it will not match. May come close but not match. When the shower was done the first time extra grout should have been saved to touch up if needed. But because this is not the case. You would be better served by removing all grout and re-doing entire wall area.
I do have a concern however. If you have that much grout cracking and falling out, there is something wrong with the tile job. The grout is cracking because of tile movement. Which should be non-existant. Any re-grout of walls without solving movement issue will be a short lived waste of time. As the grout will crack again. Regardless if you used sanded or non-sanded type.
You can add additives to the grout when mixing it that will help make it stronger, but again short lived fix.
The grout will stick pretty much any angle as long as the joints are clean and dry when applied.
As far as caulk vs. grout in corners. Your right about conflicting views.
If the shower pan is tile or cement. Grout will be fine. If its a plastic base of any sort, you should consider using a caulking. Reason being the grout is nothing more then portland cement with color additive and some other chemicals. It is basicly cement. Which does not flex with any movement. Thus if used with pastic pan the expansion and contraction of the pan with hot and cold temps will cause the bond between the plastic and wall tile to fail. Caulking will flex and if properly done will not fail. If the pan is tile or cement type. It should not move anymore then the walls. Thus the grout should not fail.
But once again, if you have a lot of failed grout, You need to find the reason and fix that before you spend the time and money re-grouting.