I am having very similiar problem. [Go to my post on 1/22/00]. One thing I notice in your post is that you should be giving your tang some veggies. This fish is a vegetarian. I use plain old lettuce, unless you have a lot of green algae in your tank for him.
Since my post last month, I am thinking that this fish may actually be rubbing is skin off on a coral skeleton that I have in my tank. I got him as a baby and he has at least doubled in size since then. However, as a baby he would lodge himself between the tight crevises of this coral [head first] then back out when he wanted out. Well as a larger juvenile, he still does this, only he's grown, and the rock hasn't. I think he is acttually causing the "wasting" area around his head and eyes! I don't know what decorations you have in your tank, but check out to see where this fish sticks his head. They seem to like to lodge in rocks head first; then, of course, when they back out of the rock, they are "going against the grain" so to speak, and may be causing abrassions. Let me know if you solve the problem! I'm going to be removing that coralhead from my tank soon, to see if it makes a difference.