Hi, my chinchilla Dezzy also has malo. It sounds like your chin's case may be more severe, but I'll share my experience.
We're not sure how old Dezzy is, but I think she's seven or eight, and I've had her for four and a half to five years. The entire time I've owned her, her right eye would be periodically watery, and then it would go away and then come back, and the vet thought it may be allergies.
In the fall of 2010, she became very sick--looking back, I can see it was more gradual than it appeared to me at the time, but she lost a signficant amount of weight, started drooling, got a watery eye, and stopped eating. I took her to the vet and started doing some reading on this website about what I could do for her, and most importantly, how to get food in her when she didn't seem to be able to chew pellets or hay. I got some good ideas about grinding hay and mixing it with water, but Dezzy wouldn't eat that, either; then I found some of Tanya's postings on the subject and checked out her website. I contacted her through her website to get advice and bought her herbal supplement and her handheld supplement (which Dezzy loves).
Meanwhile, the vet found a tooth spur growing through the roof of Dezzy's mouth. He was able to remove it; he also found some misalignments in her teeth and uneven growth, so he filed her teeth down, but he didn't take x-rays at that time.
Dezzy bounced back very quickly and she actually loved the handheld food--thankfully, she eats it off a tiny spoon quite happily so I don't have to use a syringe (she HATED that). Unfortunately, not long after, she started drooling and dropping weight again.
Between between Sept. 2010 and Jan. 2011, she had three teeth filings. He did x-ray her teeth at the second filing and told me that we had "quite a mess" in there. He said that Dezzy has an orbital-shaped growth of roots on the upper right side (which is why her right eye was watery off and on for about four years), and the roots on the lower right side are close to growing through the mandible.
The vet told me I needed to get her to eat more hay and a variety of hay; the problem of course was that Dezzy had never really cared much for hay, preferring pellets.
The vet told me I had to drastically cut back on her pellets to encourage the eating of hay; since I knew it may be difficult for her to eat enough hay to maintain weight and get proper nutrition, I supplemented with handheld feedings.
I took the vet and Tanya's advice and offered Dezzy a wide variety of hay--different cuts, varieties, and brands. I discovered a few she seemed to like, but after a few purchases of one brand, she would stop eating it because she got bored with it, so then I would switch to another brand. I rotate between a few different hays to keep her interested.
I also cut her pellets to 1/2 T./day. I give them to her at night; at first she clamored for them and ate them all really quickly. These days, she doesn't even usually eat all of them; instead she wants the herbal supplement.
I offer her hay in a couple different places in her cage, and I give her a handful of "fresh" hay in the morning, another "fresh" handful in the evening, a "fresh" handful at playtime, and a "fresh" couple handfuls at night. I say "fresh" because I discovered that if the hay has been in there for more than 8 hours or so, she won't touch it, she wants it "fresh" from the box, so I oblige. I also still handfeed her (a mix of handheld formula and ground hay); I'm down to 3x/day (it's a much smaller quantity of food than it used to be) and I'm working on reducing the amount I feed her at each feeding so I can hopefully wean her off.
Her last filing was just over a year ago and she's made a great deal of progress. Her last instance of watery eye was this summer; she had gotten down to around 820 g when she was really sick initially, and she is now maintaining her weight between 940 and 948 g (I weigh her every day and write it on the calendar).
She used to hardly look at hay, now she seems to actually enjoy it and is excited when I put fresh hay in her cage. She rarely eats all of her 1/2 T. pellets at night. She is very active and spunky. I do have lots of wood in her cage; she still seems to prefer a lot of the softer woods, but she does enjoy chewing wood.
I do not think she has been cured of her malo, but I think the diet modifications I've made (and she's adapted to) have greatly improved the situation and has definitely prolonged her life; it was a long process to change her diet, and it was frustrating at times.
A year ago, I was strongly considering putting her to sleep, and I fully expected her to not make it to summer, but she started improving and continued to improve and right now she's doing great. I know that eventually I will probably have to put her to sleep because of her teeth problems, but for now, she's doing very well and it seems that the progress of the malo has been slowed. I have not had an x-ray done since the first one, so I don't know what her teeth look like now.
I'm also really sorry that your teeth filings are so expensive; mine were not nearly as expensive, but I live in a much less expensive area of the country. Reading about your chin, your chin's situation may be worse than mine since your chin is so much younger; maybe Dezzy was just a lazy chewer (I didn't know about that term before reading this thread), I don't know. All I know is that I made some drastic changes to her diet and she's doing much better.
I hope my experience with Dezzy helps you in some way. I'm sorry it's such a long post, but I'm so proud of the changes Dezzy has made; I did not think she was capable of making the changes, and I'm so thankful for the time I've gotten to spend with her over the past year.
Nicole
PS I attached a picture of one of Dezzy's handheld feeding sessions from last February.