How often are you bathing him? The oatmeal can relieve it but not necessarily solve the problem, and if you bathe him too often, it will make it worse because baths are drying. Flaxseed oil in the food and on the back can help, though it seems that in more severe cases of dry skin, the latter is pretty much needed daily and is unlikely to actually solve the problem. A humidifier near the cage can help also, and I've seen two topical sprays recommended various times on here (Rain and Humilac); we actually just got Humilac for Archimedes, but since it literally arrived yesterday, I can't report on how well it's worked for me personally.
http://www.harrisonsbirdfoods.com/HEALx ... tments/49/
http://www.petco.com/product/109601/Vir ... Spray.aspx