I have not seen anything thing like that. The closest thing it reminds me of is scaly mites, but I don't think it can do that much damage that quickly.
My other thoughts would be something more exotic that a vet would likely need to diagnosis. An autoimmune disease or some rare bacteria infection. Or maybe a fungal infection.
I would probably try using hydrocortisone ointment and bacatracin. Ointments in particular will help seal in the moisture in the skin. The hydrocortisone should help with the inflammation and the bacatracin will help with any infection. The only problem I see if the skin is as delicate as you say, it will likely peel off more. It sounds like that may happen one way or another though.
The Epsom salt bath I am not sure I would continue or not. The salt in the bath could be drying out the skin even more. Usually salt is used to remove excess fluid from inflamed tissue. You do have swollen tissue, but you also have the dry skin too. I know it is the go to on things like this, but it may not be helping. I would try stopping it for a few days and see if it makes a difference.
My other thoughts would be something more exotic that a vet would likely need to diagnosis. An autoimmune disease or some rare bacteria infection. Or maybe a fungal infection.
I would probably try using hydrocortisone ointment and bacatracin. Ointments in particular will help seal in the moisture in the skin. The hydrocortisone should help with the inflammation and the bacatracin will help with any infection. The only problem I see if the skin is as delicate as you say, it will likely peel off more. It sounds like that may happen one way or another though.
The Epsom salt bath I am not sure I would continue or not. The salt in the bath could be drying out the skin even more. Usually salt is used to remove excess fluid from inflamed tissue. You do have swollen tissue, but you also have the dry skin too. I know it is the go to on things like this, but it may not be helping. I would try stopping it for a few days and see if it makes a difference.