Our dog also had mange when we adopted her...bald spots didn't start to develop until after we had her for about a week. She also itched, but not as bad as what you are saying. Our vet told us to give her one fish oil pill per day...it really seemed to help with the itching...if you poke a hole in it they eat them easier. Large bottles of the pills are fairly cheap. She was also on Ivarmectin. She also gets Nutro Ultra dry food, which seems to be very good.
Good luck...it may take a while, but he should get over it and have a great coat. I look at pictures of Gabby when she looked her worse from the mange and can't believe it is the same dog now!
Wow...that Buddy picture is amazing...and really sad! Poor guy.