I would start at the dermatologist. They will be able to come up with something that will help. If he isn't in any pain, the only sadness in his life is having to live on the porch. I am not judging!! It seems that both of you are really torn up about this and my heart goes out to all three of you. I just tend to think that if it cleared before, it could be cleared again and then managed with the proper care. He is so sweet! I love a good "Bagel" (basset/beagle). Keep us posted on how it goes.
My heart goes out to you guys too. I don't have any advice really but deep down if you know it's time then it's time. I was faced with this decision last year with Ace and it tore my up inside. I agree with the others and maybe see a dermatologist. Could really help. She is getting up there so be prepared for that decision should you and your wife need to make it.
Three Hooligans and 1 Angel - Wilson, Sally, Emma & Jack