Questioni have some sort of insect - leaves a sawdust trail that looks like a worm sticking out of tree about 1/2 to inch long. bark is now peeling off exposing gray-tan saw dust and tiny worm-larve about 1/8 to 1/4 in. long. Any ideas?
AnswerSounds like Asian Ambrosia beetle. Here is a web link that gives information and control measures. http://www.ces.ncsu.edu/depts/ent/notes/O&T/trees/note111/note111.html
Since this is not a real common insect I would recommend you contact your local State Forestry agency and ask them for advice. Thes can be sprayed with an insecticide to control the borer.