To be honest, though it takes guts that I haven't always had, the most humane way (widely accepted) to put a fish down is a major wack to the head...smaller fish put in a bag and wacked on a counter. Very fast. I've only been able to do it in dire situations where I really couldn't stand looking at the fish suffering anymore. Haven't heard about the baking soda thing...I'll have to look that one up.
I think, ryan, you are in a tough position. You could/i] try cutting off the affected leg or portion with a clean cut from a razor blade or so. But to be honest, the animal looks pretty thin and the stomach out the mouth is not good. Tough call to make...but if it isn't affecting water quality and the animal is still moving around...well? Hard to call. For echinoderms, and reef systems, specific gravity is often kept higher - 1.025-1.026 (though temperature comes in to play). I would say most inverts do better in higher salinity water, and, if the salinity is "out of typical range" it is better to be higher than too low. Most hydrometers are quite inaccurate to begin with, but that "safe" area is kind of an old time "fish only" standard. Historically fish only systems are kept at lower specific gravity as an anti-parasite measure.