The soil is very hard and I have to usually use a pick and a shovel to break through the layers when digging. When i was surface watering it would not seep through very well. The core of the root ball was about 1 foot below the surface when planted 3 years ago and I'm watering from 2-3 feet down until the water level rises back to the top because I was recommended the deep root stakes as it encourages root growth downwards where the water tends to remain longer during summer months and because the hard clay soil tends to spread water outwards rather than down like loose or sandy soil. I was told these trees need a lot of water but infrequently so I'm putting about 40 gallon worth per tree every month but I don't know how much is actually reaching the roots. I'll buy the chelated iron asap and dig to see soil mosture content 1-2ft deep. If it turns out to be over-watering can the trees survive and what can I do other than just wait before the next watering cycle?

These are not mealybugs. Cottony cushion scale is very difficult to control...and can lead to the demise of citrus if left unchecked. Your good image shows a number of female scales carrying full egg sacs around with them. Each sac holds many hundreds of bright red eggs. Tear open one and take a look for yourself. After the eggs hatch, the 'crawlers '(hatchlings) take off and go exploring....as a matter of fact, this particular scale stays mobile. Early instar stages look entirely different from their highly recognizable egg parents, which makes their control even more difficult. Hand wiping with alcohol a nearly futile option. I believe I see one of the earlier nymphs in the picture...at 3:00 o'clock just to the right of the adults. The younger crawlers are much too small to observe easily. You should do a bit of research that you know what cottony cushion scale insects look like in all stages. Also important is recognizing the beneficial critters that usually do a great job of control for us. A species of ladybug, the Vedalia beetle is the most important predator of these pests. There are no good chemical controls. This post was edited by rhizo_1 on Tue, Mar 19, 13 at 18:18

Looks like they desperately need to be watered. It looks like you did water, but perhaps you allowed the trees to dry out too much, and the trees are simply in shock from not enough water. I would move them to a shady area, keep them watered appropriately (not too much, but not bone dry), and allow them to start to recover. One you start to see new leaf flush pushing out at the leaf nodes, fertilize (be sure to water first, fertilize, then water in the fertilizer). Lastly, be sure you have well draining potting medium. Something out of a bag is going to be too dense. I use 3 parts MiracleGro Vegetable Soil (that particular one, not any other), 1 part perlite, 1 part small bark mix (I use coarse orchid mix or reptile bark from PetsMart). For fertilizer, I use Osmocote Plus (MUST be the "Plus" formulation, as it has the appropriate NPK ratio along with all the micronutrients), as well as using full strength Dyna Gro Foliage Pro once a month. Patty S.

Wait until your Spring, when both your tree and the rootstock are actively growing. Ask your local nurseryman for a good rootstock for your area; get 10; then do 10 T-buds or chip buds; and if you do them carefully, you should get at least 2 or 3 to take. When they are strong and growing well, I would take out the old tree or leave it and put the new tree(s) in another place. You can prune the old tree quite heavily, if you want to save it; as long as the trunk is solid and healthy; it will grow new shoots. BTW, one of the reasons the oranges from the old tree taste so good is the age of the tree; the new grafted trees should produce fruit in a year or two and they will be "clones" of the existing tree. Be warned, though... fruits from the new trees may not taste as good for a few years.