I'm not entirely sure, but I think it was either a really bad ringworm site or a product of what we later found out to be a food allergy. This was quite a few months ago, and after everything that's happened I think it had more to do with his food allergy/intolerance to poultry. Finnegan still doesn't have fur growing back where the scan used to be - it's just a bald spot now. We feed him lamb and rabbit mostly now and he's doing perfectly fine. I think he's allergic to tuna as well, because he would vomit it up very quickly after eating it... sensitive kitty!
It could have been ringworm too, though. You says it's spreading, so it sounds like it may be ringworm. I'd take the kitties to the vet so they can look at their skin and shine a wood's lamp on them. Good luck!!