So I decided to keep Phaistos's body with me on my way to the pet store, even though he was dead. And I'm glad I did because his orangey-yellow spot spread, and even turned partially gray. And Erasmos's condition was so bad when we got there, I had the guy euthanize him. Even so, he wasn't much of a help. Basically, he said the same things we said, about restarting the tank so that the thing will die off. He did say he had seen the gray tissue before on a fish, just never as bad as my little buddy had it. :c So I just bought a brand new filter and I'm working on emptying the tank right now.
On a positive note, my dad decided he wanted a betta, so he bought a 5g tank and all the fixings, and we set it up and everything, and his new guy is a shimmery blue and green CT. He's just gotten loose in the tank, and he's exploring and everything. Yes, heated and filtered and with decor and greenery.
His tank is a great little betta home. I'm glad my dad thinks bettas are so awesome and is getting into taking care of them himself.