No, it is not the "skin" or sheath peeling back that makes the psuedobulbs look dry. It is that they are quite shriveled which can be from a lack of water, but can also be from old age. They usually start to really shrivel when they get really old. Some will even look dead (especially on a dendrobium), but may still be giving the plant energy, so you don't want to remove it.
I don't know if it is mold or not, but to be safe you could cut off the infected area (not more than that though) and treat the cut with some cinnamon. I would watch it very closely too.
The shutlz orchid food should be fine. Just soak it for several hours before repotting. Also remove all the old medium from the roots and you can also soak the plant or a bit to make the roots more pliable for potting. Do not reuse the water you soaked the plant in for any other plants in case it does have somethign which you would not want to spread. Good Luck!
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