Are mites contagious to other birds?
Yes, they will infest all your birds and their housing.Would they cause the diarrhea?
Is the treatment everyday for 5 days or 1 day every 5 to 7 days?
You want to get rid of them.
Mites suck blood, heavy infestations can cause anemia, they can affect production, feed conversion, make your birds miserable.
You can find Permethrin dust or spray at stores like TSC. You can find spray premixed or buy a concentrate you mix yourself. Dust is in a can.
Treatment is in 5-7 day intervals = meaning treat your birds and clean out/treat your housing once every 5-7 days days.