Scaly Leg Mite can be treated by washing and brushing the legs with a toothbrush in warm soapy water to dislodge the crusts. Do not pull away the scales or crusts as this can damage the skin and cause bleeding. Then apply, with a small paint brush, Benzyl Benzoate available from animal pharmacists on the web (or possibly your local chemist). Repeat this 4 times at weekly intervals. Thoroughly clean the house as for red mite.
This mite if unchecked will slowly migrate from one bird to another. Some similarly to Joy suggest controlling an outbreak by once a month smearing the legs and perches with Vaseline, liquid paraffin or a mixture of one part paraffin with two parts linseed oil. Though it's pretty messy and obviously you’ll have to ban them smoking in bed!
If treated successfully, and give it a month to show signs of improvement, new scales will eventually grow back though this is a slow and not always a scar free process.
Invermectin is also claimed to be effective though not designed for birds so no withdrawal periods are known and for this reason it is only recommended for show birds. See
http://www.abbaseed.com/Supplements/Suppl2/IVERMECTIN/ivermectin.htmlHF
