DE isn't effective moist, and is only marginally effective dry. OP said the coop was moist/smelly.
DE taken internally has none of the effects you ascribe. The closest scientific support for that conention you are likely to find
is this study, whose sample size is tiny, whoe effects were zero for one breed and barely noted for the other, with no plausible explanation differnentiating the initial parasytic loads, of the fact that they all went to near zero, whether treated with DE adulterated feed or not. Frankly, the whole study looks like it was desperately seeking any effect for the DE, and thus tested for everything - no mechanism is offered as explanation for any of the observed results.
Neither is it an effective dessicant. DE resembles a dessicant in its effect against insects because it abrades off the protective waxes on their carapace, resulting in their eventual slow death via dehydration to the air around them, NOT because it absorbs moisture itself - unlike, say, silica gel.
"its worked like magic for me" Yes, yes it has.