If you're going to give the miralax, make sure Harry gets PLENTY of water with it.
I have 2 that are on miralax, both 1/4 teaspoon in their big meals ,twice a day, then a pinch in snacks.
Taco has been on it since a few months after starting insulin(18 months) and his littermate since 13 years.
They both get 3 ounces of water in 3 ounces of food, so more like soup.
Also all my cat bowls are raised to about 4 inches, or else they inhale too much air and we get the projectile vomit
Tacos littermate George is not diabetic ,but does groom a lot and he gets hairballs, so he gets hairball remedy.
Taco has never had a hairball, but, he doesn't loose hair like his brother.
The most important thing with Miralax is that he gets plenty of water with it.That is the only way it works. It draws water from the cat to soften the stool, so you have to make sure you replenish that water taken from the body. If he won't drink enough water with the miralax, try boiling some chicken and give it to him mixed in the broth. No salt, plain broth.
The flaky skin and dull hair you are seeing is most likely, high numbers, lack of water, which results with constipation. A vicious cycle.

Hope things work out, literally, for Harry.
If it ends up being a hair clog and he gets an enema at the vet to clear him out,for future problems with what you KNOW is positively hair, you can order your own enemas and give it yourself, it's not fun or pretty but it has saved me probably thousands throughout the years.
Taco my diabetic has never gotten an enema ,but, came close, until the miralax kicked in.
Maybe your vet can show you how to administer the enema.
If you want something gentler than the cat enema, you can always buy a regular people enema, EMPTY THE CONTENTS !!, and fill about 1/4 with lukewarm filtered water, you may have to repeat that a couple times. BUT ONLY IF YOU KNOW IT"S HAIR. and only insert 2 inches with plenty of vasoline. DO NOT FORCE.
It would be best if your vet can show you.