Could you please answer all the questions in this thread? http://www.bettafish.com/showthread.php?t=49233
You've gone over most of it, but it will be easier to evaluate the fish's current situation if all the information is in one place. As for the blood worms--freeze-dried foods can cause some of the worst constipation I've ever seen in fish. They aren't nutritionally complete either--it would be comparable to you eating beef jerky every day. Personally, I have completely cut freeze-dried foods out of my fish's diets because I've had such problems with them.
I recommend getting a higher quality pellet and supplementing his diet with frozen foods. Good pellet brands include: OmegaOne Betta Buffet Pellets (my favorite), Atison's Betta Pellets, Ken's Betta Crumbles, and New Life Spectrum. Hikari makes wet frozen foods for fish that are more nutritious and digestible than freeze-dried. I recommend frozen blood worms (for protein) and frozen brine shrimp and/or daphnia (for fiber).
If you must use the freeze-dried foods, do so sparingly, and always let them rehydrate in tank water for at least 5 minutes and break them into small pieces to make them easier to digest. Soaking the pellets in tank water will also make them more digestible and palatable to your fish.