Welcome, and sorry to hear your little guy isn't doing so well..
It looks to be as if he has a bacterial infection going on.. I also believe he is starting to pine cone (the scales sticking up) slightly, which tends to be a sign of internal organs shutting down.
Treatment for him at this point would be 1 tsp per gallon of Epsom salt, along with either API Tetracycline, API Triple Sulfa OR Mardel’s Maracyn I & II for the bacteria. He looks pretty far in the infection, so I can't promise he will pull through, but if you are willing to try then that is the way to go with those medications.
I normally would just go with AQ salt for bacteria infection, but since he is pine coning, Epsom would be a better choice.
On some other notes- in the first picture, his dorsal fin looks see through, or perhaps missing part of the fins at the base? It also looks to be a case of fin rot, as his points of his fins are missing.. in time it may of caught up to the body from lack of treatment and proper water changes, along with high ammonia.
As mentioned above, recommended to not use the "fixes" on the bettas, as the risk for damage is greater with them then other medications.
In a 2 gallon a 25% is a dangerously low amount- as mentioned, ideally for anything unfiltered, no live plants 1-4 gallons is 1 50% and 1 100% water change per week with water conditioner. Without proper water changes the ammonia build up will cause him to go into shock, poison him, and burn him- him getting holes in his fins and since the water quality isn't ideal, the fin rot (a bacteria) will set in on the damaged fins.
Bottled water is not ideal to use in aquariums- it lacks the proper nutrients and minerals that is taken out during the filtration process.. the water is not as healthy as tap water with water conditioner in it.
There are a lot of myths out there, a lot of pet store employees who have not done any research nor are trained in fish care, and a lot of wrong info on the internet (Yahoo! Answers is especially bad for information).. so not wanting to sound down on you, just letting you know there are some required changes to properly care for these guys to avoid illnesses such as what is going on now.
Good luck and keep us updated.