We did the dip a couple of days ago, added carbon to the tank, and did a large water change today.
Sadly, the leather was not improving.
Additionally, our multi-head frogspawn is not looking good.
Doing some research, I am starting to think that the large toadstool was aggrevated for some reason which was causing these scabs, and as such was aggressvily releasing toxins in an effort to protect himself.
Regardless, the toadstool was thrown out today. It isn't worth the risk of the toadstool completely dying and fouling the tank causing a crash, or is it worth losing my LPS corals that are starting to look unhappy.
Hopefully I made the right decision. As it was progressivly getting worse, I thought attempts at nursing the toadstool back to health entailed too much risk.