Hi Amy, have you had a vet take a look at it to make sure it is dry skin and not something else like mites or fleas? If it really is dry skin I can think of something that will help everyone: a humidifier for your home. There are ones that are pretty pricey that attach to your furnace or units that are self-contained. I prefer the ones that are misters or use heat, not the ones that have a filter that absorbs the water and the fan blows on it. I’ve seen them for good prices at Walgreens and Target. I opted for a more expensive one from BB&B that has a UV bulb that kills anything in the water and it vaoporizes with heat.
I think that gently brushing every day with a baby brush will help distribute the natural oils enough to help the skin as well as it may stimulate production of the natural oils that help to condition the skin.
As for applying any type of creams etc. it would likely get licked off and would lose its efficacy. I think that aloe would be good for it, but would make the fur matted and cause more problems. There might be something that your vet can recommend be added to your buns diet like more vitamin A, or an oil to help. I would steer clear of anything unnatural and is not vegetarian (rabbits are herbivores). I had a vet recommend to me that I give my two an oil composition that had fish oil as part of its ingredients! Needless to say, I do not see that vet anymore. I am trying to think of any veggies you could feed to help out too. I’m going to have to think about that.